Market Drama
Featuring Zoe CEO & Founder, Andres Garcia-Amaya, CFA
Welcome to this week’s Market Drama!
Stock Market Updates:
- The S&P 500 was up 0.9% for the week.
- Nasdaq also rose, up 0.8%.
- Both indices are up 23% year-to-date.
- At a micro level:
- Stocks like Netflix outperformed expectations, rising 11% after surpassing analyst EPS estimates.
- The Taiwan Semiconductor report delivered better-than-expected numbers.
- At a macro level:
- 14% of companies in the S&P 500 have reported Q3 numbers. Of these, 79% reported EPS above estimates, exceeding the 5-year average of 77%.
- Why were the markets near all-time highs?
- This marks the 6th consecutive weekly gain for the markets.
- With the Fed starting to lower rates, the critical question is whether the economy will hold up. Equally important is whether corporate profits will continue to thrive.
- Last week provided tailwinds to the markets as economic growth is increasing slightly better than expected, corporate profits continue to impress, and Fed policy remains consistent.
- Oil was down 9% for the week, down 4% for the year.
- Concerns are rising over potential Israeli attacks on Iran’s oil and gas infrastructure.
Economic Updates:
- Retail sales showed better-than-expected growth, with a 0.4% month-over-month increase. Note that consumer spending accounts for roughly 68% of GDP.
- Following the Atlanta Fed’s GDPNow number release, the GDP growth expectation for Q3 has risen to 3.4%. If this estimate holds, it would indicate a much faster economic growth rate than typically observed heading into a recession.
Stay tuned for next week.
– Andres
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