October 23, 2021 Weekly Market. With 75% of S&P 500 companies have beaten revenue estimates for Q3 to date, and now reporting the third highest (year-over-year) growth in earnings since Q3 2010, the U.S. equity markets rallied on the week: The S&P 500 Index rose +1.64%, leading the major indices followed by the Nasdaq +1.29% and the Dow Jones +1.08%. The Biden Infrastructure Bill is still being negotiated downward to below $2 trillion yet has many items in contention between Sinema and Manchin. The U.S. leading indicator rose 0.2% to 117.5 in September marking a 6th straight new all-time peak.
October 16, 2021 Weekly Market. Stocks posted their best week since July after earnings, with retail sales and banking earnings topping estimates. Consequently, the broad market blue-chip index of the S&P 500 closed out the week higher by about +1.8% in its best one-week increase since July. According to FactSet, the S&P 500 index is now "reporting the third highest (year-over-year) growth in earnings since Q3 2010." While only 8% of the companies in the S&P 500 have reported earnings results for Q3 2021, 80% of the composite have reported actual EPS above estimates with averages exceeding expectations by 14.7%. Banks posted much stronger-than-expected third-quarter earnings results, including Bank of America (BAC), Citi (C) and Morgan Stanley (MS), which helped alleviate investor concerns over a sharp deceleration in corporate profits. The Consumer Price Index (CPI) rose +0.4% overall with the core increasing +0.2% in September; and on a 12-month basis, the headline rate rose to 5.4% year-over-year, marking the 10th straight month consumer inflation came in over the five-year average. However, supply chain issues remain strained and therefore continues to help fuel inflationary pressures.
October 9, 2021 Weekly Market. The Dow Jones Industrial Average led the major US equity indices with +1.22% followed by the S&P 500 Index +0.79% and the Nasdaq +0.09%. Core inflation rose +3.6% in August from a year ago, the biggest jump in more than 30 years. Supply chain shortages have elevated preexisting inflationary pressures by growing beyond electronics and chips into most other commodities: oil is at a 6-yr high, beef up +14%, pork by +12.1%, and poultry by +6.6%. Even food-away-from-home like restaurant purchases is +4.7 percent higher. Also, the job report was disappointing only 235,000 positions added vs. expectations of 720,000.
October 2, 2021 Weekly Market Update. The S&P 500 equity index fell -4.8% in September, representing the worst month since March 2020. Further, the S&P 500 finished the month -5.1% below its all-time high set on September 2, 2021. Fortunately, on the first day of trading for October the S&P 500 bucked the past four days of losses with a robust turnaround in trends, rebounding +1.2% on the day. On the economic front, consumer spending, which accounts for over two-thirds of U.S. economic activity, rose +0.8% in August while inflation also maintained its upward trend with the monthly personal consumption expenditures (PCE) price index up +0.3% (+3.6% over past 12-months}.