PVG Market In A Minute - February 6, 2024
The market set up is odd and therefore we believe it is prudent to think about asset allocation. Not to overcomplicate the discussion with political views, and geopolitical risks.
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The market set up is odd and therefore we believe it is prudent to think about asset allocation. Not to overcomplicate the discussion with political views, and geopolitical risks.
Read BlogThis is a very critical week for technology earnings, with AMD, GOOG and MSFT reporting on Tuesday after the close and then AMZN and APPL on Thursday. The top 6 technology stocks comprise 27.6% of the S&P 500...
Read BlogHigh Conviction Valuation Problem: The projected 12-month P/E on the S&P 500 is 19.9, above 20 we would consider this risky and bubble valuations.
Read BlogThe market is valued at 19.7x the 2024 earnings estimate of $243, which is at the outer bounds of the last 10 years when interest rates were much lower (adjusted for the negative impact of Covid on depressing earnings, which inflated the P/E).
Read BlogThe Big Market Issue is Changing from CPI to EPS: We get CPI on Thursday, and it is expected to be up 3.2% year over year. Goods inflation has come down while services has remained elevated due to higher labor cost.
Read BlogWe are looking for an opportunity to pick off certain securities and sectors on a dip. For now, we believe it is prudent to be cautious. The set up currently has too much risk to be aggressive.
Read BlogAs everybody has already heard, the Federal Reserve’s Dot Plot changed a great deal, to now expecting .75% in cuts in 2024. The market or the Federal Funds futures are now expecting 1.5% in cuts in 2024.
Read BlogThe bull case for the market is the economy on a nominal basis will grow at roughly 5%, with 2% coming from real GDP growth and 3% coming from inflation, allowing earnings to grow at over 10% for the next two years.
Read BlogThe rotation that we discussed last week of the technology sector slowing or declining and money moving into quality Blue Chip and smaller companies, rather than just the mega-cap technology stocks, appears to have started.
Read BlogThe market is experiencing a seasonal rally, which we believe there still is some upside potential. The market is convinced the Federal Reserve has finished raising rates, we would agree.
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