Fourth quarter 2020 corporate earnings season likely will be the last in this earnings recession. Earnings may grow in the first quarter of 2021 and beyond. The economic recovery can drive a rebound in corporate profits.
Democratic control of Congress may not impact 2021 policy as much as many believe. The biggest changes may be around taxes, regulation, and stimulus prospects. With the elections behind us, 2021 policy is coming into focus.
2020 was a unique year, from the longest economic expansion ever to the shortest recession on record. Stock markets are forward-looking, and they want clarity on elections, too. Above all else, 2020 showed our ability to persevere.
2020 was a tumultuous year. We likely had the shortest recession ever and began a new economic expansion. Small business and effective COVID-19 vaccines hold the key to continued economic growth in 2021.
Increasing COVID-19 cases in Europe and the United States have brought new restrictions. The stock market doesn’t appear fazed by the recent outbreaks, but underlying economic data is beginning to reflect the latest government and consumer shutdowns.
The reaction from stocks since the US election has been strong. The S&P 500 Index is up, and small caps have soared. Sentiment could be getting a little frothy as well, which may increase the odds of a pullback.
Corporate earnings results were surprisingly good in the third quarter, with 84% of companies beating earnings expectations. Stocks most likely are in a new bull market, potentially supported by a durable economic expansion.
Equity returns have been strongest under a split Congress, a likely scenario in 2021. Big tax increases are likely off the table, but passing another stimulus bill will probably be a priority for both parties.
2020 has been a year of records, including the sharpest rebound in GDP since WWII. Plus, consumer spending rebounded mightily after the second quarter contraction. What does this signal for the election?
As the race for the White House enters the homestretch, some indicators suggest the election may be closer than polls are saying. GDP, stock performance, and the US dollar all have a history of picking the winner.
Corporate America will get closer to the return of earnings growth this earnings season. Investors will need to watch for continued impact from COVID-19, policy changes based on the election outcome, and winners that keep winning.
Technology has mitigated downside during bouts of pandemic-inspired market volatility, while also posting considerable outperformance. In September, however, it has corrected more than 12% from its prior highs. What does this correction mean?
The Federal Reserve, European Central Bank, and Bank of Japan met in September to discuss the economy and monetary policy. Their policies remain focused on economic recovery, with an eye on COVID-19 developments.
In Part II of our two-part election preview series, we look at the potential market impact if President Donald Trump is elected to a second term as president. We cover what we may expect in taxes, deregulation, jobs, trade, and initiatives.
In Part 1 of a two-part election preview series, we look at the potential market impact if former Vice President Joe Biden is elected president, including what to expect in taxes, regulation, initiatives, and governance. Next week, we cover the same for President Donald Trump.
Corporate earnings blew away expectations this quarter, with an average upside surprise of 22%. There are a number of reasons estimates were off, and we have five key takeaways from this earnings season.
The US economy is struggling at the same time the stock market keeps churning higher. We highlight differences between the stock market and the economy to explain the disconnect between the S&P 500 and GDP.
August and September historically have been troublesome for stocks. Meanwhile, gold is breaking out to new all-time highs. Stocks may be ready for a break, but it’s still possible gold and stocks could trend higher together.
The stock market has shown some weakness recently, and timely data indicates the economic recovery may have stalled. Weekly jobless claims have increased, too. Investors are asking if the long-awaited market pullback is here.
COVID-19 lockdowns and widespread withdrawal of corporate guidance have set up an unpredictable earnings season. The magnitude of the decline we may see may make this an earnings season to forget. But it may not all be negative.
2020 is an election year, and history shows that the US economy has had major bearings on presidential election. How stocks and the economy are performing prior to the election may forecast the winner.
The US economic recovery has picked up, and we expect Treasury yields to rise later in 2020, but structural pressure from the Fed, pandemic-driven demand, and inflation may limit the increase. Investors seeking income are in a tough spot.
Stocks staged perhaps the strongest rally in history—a more than 44% gain for the S&P 500 Index from March 23 through June 8—before pulling back about 3% late last week. With so much economic healing ahead of us and a still-uncertain path for COVID-19, the key question for investors is whether stocks are pricing in an overly optimistic scenario for the recovery in economic activity and corporate profits.
The strongest 50-day rally in the S&P 500 in over 70 years has sent a signal that the economic recovery is gaining steam and may look more like a “V” than a “U,” a square root, checkmark, or swoosh. We assess the probabilities of these various scenarios for recovery and reiterate our 2020 economic growth forecasts.
Stocks rallied to close May on the positive side. There’s still a disconnect between the market and the economy, while reopening optimism and massive stimulus compete with COVID-19 concerns and US-China tensions.
First quarter earnings season offered a mixed bag. Corporate America produced solid results outside of the COVID-19 pandemic trouble spots, while 2020 earnings estimates have plunged. A return to “normal” earnings could be two years or more away.
Stocks fell last week, and we think more near-term downside may be possible. We take a look at likely catalysts, including high stock valuations, Fed Chair Powell’s gloomy outlook, and rising US-China tensions.
Stocks tend to lead the economy, and they’ve had a historic run recently. Both a rebound and some equity weakness may be likely. Stocks may also take a break as we enter the historically worst six months of the year.
Financial news provided the highlights in a week with the S&P 500 Index ending about flat. Headlines featured estimates of Q1 2020 GDP, a top-tier economic report, major central bank meetings, and the busiest week of earnings season.
Negative oil prices have dominated headlines recently. While few of us speculate on commodity futures, the price of oil is an important variable. We explain what happened and where oil prices could be headed ultimately.
COVID-19 travel restrictions and lockdowns have impacted corporate earnings results dramatically. As earnings season begins, we believe there will be winners and some challenges, the bar may be set too low, and forecasting has included some guesswork.
Stock market volatility remains high as investors closely track COVID-19. We’re watching for signs that investors can start thinking about a resumption of economic activity and an economic rebound. In the meantime, stocks may revisit the March lows.
The COVID-19 impact to our economy and workers has been devastating, but we’ve seen some positive developments from monetary and fiscal stimulus. We update our Road to Recovery Playbook on signs of a major low in equities.
The US economy has been impacted in a number of ways, and we are likely in recession now. What began as a crisis of confidence has transitioned to a business crisis, but positive steps are being taken.
COVID-19 has sent equity markets into bear market territory. But once the market finds its bottom, it may provide attractive buying opportunities. To guide long-term investors, LPL Research has compiled a Road to Recovery Playbook.