Subscribe to receive this FREE daily commentary directly in your email
Lots of shelled shocked investors out there today, after yesterday’s rather sharp and unexpected decline. Blame global growth concerns and the yield curve for the decline if you want. Has Global growth slowed that much in the past 24 to 48 hours? Doubtful.
I wonder if anyone looked at the Feds projections for growth? Doubtful. Here they are for you too look and judge for yourself. The Fed lowered its real GDP Growth projection for 2019 to 2.1% from 2.3%. The inflation rate to 1.8% from 1.9%, but cut their rate target to 2.4% from 2.9%. Point being that the growth downgrade and inflation targets were reduced modestly, but yet the fed funds rate target was cut drastically.
(FOMC)
I mean these aren’t real big growth downgrades.
Recession?
Then there are concerns about the PMI’s. The ISM PMI which is the one I follow more closely doesn’t suggest a recession is on the horizon either. February’s reading of 54.2 is well in expansion territory. Typically we have seen the start of a recession when the reading has fallen to 48 or below.
Is The Worst Behind Us?
Additionally, the ZEW economic sentiment for Germany saw a significant uptick in March, a reversal from the earlier trend. Again, I have said before, it could indicate that the worst is behind us.
Earnings Growth
Earnings continue to suggest that there is plenty of growth around as well. Earnings Estimates do continue to get trimmed but continue to indicate growth.
Unlock Deeper Insights with Exclusive Member-Only Video Content on The Market Chronicles YouTube Channel – Just $34.99/Month
13:14
Join this channel to get access to perks:
https://www.youtube.com/channel/UCIIr1ooRsSukPL7rKNr0VHQ/join
Please check out my content on Substack and Seeking Alpha:
https://www.themarketchronicle.com/
https://seekingalpha.com/affiliate_link/Youtube81624
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
4
YouTube Video VVVNT0lJcjFvb1JzU3VrUEw3cktOcjBWSFEuS3RER0RlcVg2Vjg
6:32
Join this channel to get access to perks:
https://www.youtube.com/channel/UCIIr1ooRsSukPL7rKNr0VHQ/join
Please check out my content on Substack and Seeking Alpha:
https://www.themarketchronicle.com/
https://seekingalpha.com/affiliate_link/Youtube81624
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
0
YouTube Video VVVNT0lJcjFvb1JzU3VrUEw3cktOcjBWSFEuU1FtSnNXUDNDWms
18:01
Join this channel to get access to perks:
https://www.youtube.com/channel/UCIIr1ooRsSukPL7rKNr0VHQ/join
Please check out my content on Substack and Seeking Alpha:
https://www.themarketchronicle.com/
https://seekingalpha.com/affiliate_link/Youtube81624
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
2
YouTube Video VVVNT0lJcjFvb1JzU3VrUEw3cktOcjBWSFEuY2JrTXFiNjZpTW8
(Dow Jones S&P)
Valuation
Dow Jones S&P continues to see earnings growing by 9% in 2019 and 12.6% in 2020. The current earnings estimates for 2020 are $186.40. It means the S&P 500 is trading at 15 times 2020 estimates, which is a fair valuation. Based on the S&P 500’s current price to get an average of 17 times one-year forward earnings, earnings estimates for 2020 would need to fall $164.75, a drop of 11.6% or the index would need to rise to 3,168, an increase of 13% from its current level.
(Data from Dow Jones S&P)
In either case, it would at the very least suggest that the S&P 500 is roughly fairly valued at its current levels.
Which way the S&P 500 goes from here, is anyone’s guess. For now, it seems hard to say that a recession is on the way. Slower growth sure, but we already knew that.
-Mike
Photo From Flickr
Mott Capital Management, LLCÂ is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future performance.
Subscribe to receive this FREE daily commentary directly in your email
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
Comments are closed.