We would like to first take this opportunity to wish you a Happy Thanksgiving, we hope you enjoy the day and the weekend! The financial markets are of course closed on Thanksgiving Day, and then close early on (Black) Friday, with stock market trading ending at 1 p.m. Equity investors can be thankful for what has been a good year so far, with the major stock market averages trading around all-time highs and the Dow Jones Industrial Average up approximately 20% year-to-date.
Volatility this year has centered around Federal Reserve interest rate policy and headlines regarding the “trade-war” between the U.S. and China. Big picture though, the stock market has benefitted from low interest rates, Federal Reserve rate cuts, low unemployment levels in the US, and most recently, market expectations that we will avoid a recession. Also, corporate earnings have for the most part come in better-than-expected.
Looking to the week ahead, there are a handful of notable earnings reports due out, with companies such as Best Buy, Hormel Foods, and Deere scheduled to report. Essentially though, this earnings season is now behind us and in the rearview mirror. Of the 476 companies in the Standard & Poor’s 500 Index that have reported earnings to date for the third quarter of 2019, 75% have reported earnings above analyst estimates, which compares to a long-term average of 64.8%, and prior four quarter average of 74.1%, according to I/B/E/S data from Refinitiv.
The economic calendar is light this week, but the second estimate on third quarter GDP (Gross Domestic Product) is scheduled to be released Wednesday morning and we’ll be keeping our eyes on that (expectations are for growth of 1.9 percent). As always, don’t hesitate to contact us with any questions you may have or if you would like to set up a meeting.
Happy Thanksgiving – Southport Station Financial Management, LLC