Market Drama
Featuring Zoe CEO & Founder, Andres Garcia-Amaya, CFA
Watch Time: 4.3 minutes
Welcome to this week’s Market Drama!
Stock Market Updates
- Market was up for three consecutive weeks.
- S&P 500: Up 1% for the week and 27.7% YTD.
- Nasdaq: Up 3.3% for the week and 32.3% YTD.
- Earnings:
- Next year’s earnings growth is expected to be around 14% YoY, compared to roughly 9% this year.
- Market Valuations: Multiples are no longer considered cheap. The U.S. equity market is trading at 22x earnings, compared to a historical average of 16–17x.
Economic Updates:
- Payroll data: 227,000 new jobs added, above the 220,000 expected.
- Unemployment rate: Increased slightly to 4.2% but remains below the long-term average of ~5.7%.
- The Fed might continue to lower interest rates.
- ISM Manufacturing (PMI) & Services (PMI) data: Both remain in expansion territory, with services already strong.
If earnings continue to grow steadily, inflation decelerates, and economic growth is maintained, the market could rally further with no immediate signs of a recession.
However, new administration policies could introduce uncertainty, particularly around tariffs and their impact on exporters or input costs for imported goods.
Next Week:
- CPI & PPI data.
Stay tuned for next week.
– Andres
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