2Q earnings are near the end of reporting, 452 of S&P 500 companies that have reported thus far, roughly 64% have topped revenue forecasts and approximately 75% have bested profit projections,
S&P 500 is currently valued at approximately 17 times forward-year earnings.
Probably room for more Bear Territory; follow the money.
Link?
Wendy
It is important to remember that this is looking towards the rear when vast buckets of COVID derived free money was still sloshing around. I wonder what the change in the perception of the consumer as these funds evaporate will do to the numbers.
I heard a report that the ports still have long lines of ships indicating continuing challenges in the supply lines. Another way to look at it is that, if consumers are not buying the goods, there will be a considerable period of “excess goods” which should temper inflation at the expense of excess corporate profits. This will make corporate reports look like crap compared to the previous year (and people won’t look further back and notice that it was the previous year that was the outlier, not the current one.
Jeff
It is important to remember that this is looking towards the rear when vast buckets of COVID derived free money was still sloshing around
As well, look towards the same past two quarters has been a significant S&P 500 bear: -17% 1/1 to 8/1. Some of the negative expectations are already built in. Currently, in a bull/bear recovery, lots of room for Bear Territory.
Follow the money, I still think Oil & LNG cargoes diverted to Europe’s record high prices are safe during this bearish territory.
The CHIPS bill gives credence to allocating something into iShares Semiconductor ETF $SOXX
…make corporate reports look like crap compared to the previous year
I doubt that very much. Profits will recede, but I would not sell this market short if that is what you’re implying. If you truly believe that corporate profits are going to fall off dramatically then your choices are limited in an inflationary environment.