My scorecard for earnings season will look for the following company characteristics: Confidence. I expect most to have a murky outlook, with no reason to set the future bar very high. Important trade relationships – imports or exports. Comments on these fears may create some buying opportunities. Concern about a stronger dollar. Everyone is teed up to watch for this, and we should as well.
The search for investment portfolio returns is not going to get any easier in 2017 against a backdrop of record U.S. equity prices, narrow credit spreads and low bond yields.
Some sort of fund repatriation will be part of the package. All else equal, that suggests a bias to companies that might gain the most. The Atlanta Fed provides some hard data. Expect tax cuts, probably including some nods to Democrats. This will represent fiscal stimulus. Cyclicals continue to show strength, partly from the expectation noted above. (Eddy Elfenbein). The trade war is likely to be a bargaining approach. It is an error to over-react on speculation. The health care issue is far from settled. Early symbolic repeal? Yes. Real changes? Unclear.
Factors ranging from China’s evolving economy to the rise of nationalism combined to make 2016 a year that will not be quickly forgotten.
As part of my preparation for 2017, I asked how I could be most helpful for individual investors. The suggested resolutions are a combination of expert investment methods and avoiding the most common investor mistakes. They may be difficult to follow. If you can, you will find them profitable.
2017 begins with plenty of economic data crammed into a short week. While most expected at least a touch of Dow 20K last week, it did not happen. The conversation quickly shifted to why the rally stalled out. In the coming week, the punditry will be asking: Should we expect a weak start to 2017?
There is a normal dose of economic data this week, but we are entering a quiet, pre-holiday period. As the rally faltered a bit, the Dow 20K talk yielded to a discussion of what could go wrong.
The post-election market run has been accompanied by improving economic data and increasing confidence. The result has the punditry asking a question that seemed crazy in January: Will the Dow hit 20K?
Donald Trump’s largely unexpected victory of the U.S. presidential election echoed the Brexit vote of just six months prior, reinforcing an ongoing fundamental shift in political currents and capital markets around the globe.
It is (ahem) a very big week for new data. The A-teams are back from their mini-vacations, ready to take a fresh look at the new world.