The DC Today - Monday, February 13, 2023
The Dividend Cafe
The Dividend Cafe - The Bahnsen Group
4.9 • 572 Ratings
🗓️ 13 February 2023
⏱️ 10 minutes
🧾️ Download transcript
Summary
Today's Link: https://bahnsen.co/3HXUEAl
A rally day in the markets, telling you exactly what the markets think about the theory of extra-terrestrial attacks from UFOs… More below!
Dividend Cafe took a stab Friday at applying our present economic outlook (short-term and long-term) to the logic of dividend growth investing.
Off we go …
Market Action
Futures opened down -70 points last night just as the Super Bowl was kicking off so I figure anyone trading futures at that time was a weirdo. By bedtime, they were down over a hundred points, and at wake-up, they were basically flat. The market opened up by +75 points and rallied higher throughout the day. The Dow closed up +377 points (+1.11%) with the S&P 500 up +1.14% and the Nasdaq up +1.48%.
With almost 70% of the earnings season now complete we are tracking 5% year-over-year sales growth and a year-over-year earnings decline of -2.8%. Full-year earnings estimates continue to sit at $224/share from the S&P 500. An interesting summary from Strategas Research comparing both economic data and market data now to the same in September of last year (so five months ago). All market indices are higher. Gas prices are lower. Inflation is lower. Oil prices and long-term bond yields are essentially the same. Unemployment has stayed very low. S&P earnings estimates are lower and the fed funds terminal rate is higher. When you add it all up, markets do not believe the fed funds terminal rate and short-term upper range is going to hold. The ten-year bond yield closed today at 3.70%, down four basis points on the day. Top-performing sector for the day: Technology (+1.77%) Bottom-performing sector for the day: Energy (-0.60%)
Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com
Transcript
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| 0:00.0 | Welcome to the DC Today, your daily market synopsis of the Dividing Cafe, brought to you every Monday through Thursday to bring you up-to-date information and perspective on financial markets. |
| 0:14.6 | Well, hello and welcome to the DC Today Monday edition, back at it, day after the Super Bowl. Congratulations to Kansas City Chiefs. |
| 0:23.9 | Congratulations to the great Trojan wide receiver, Juju Smith-Schuster. And today the market |
| 0:31.2 | was up 377 points. The Dow had been the futures last night during the Super Bowl were down about 70 points |
| 0:40.3 | when they opened and down about 100 points down to bed. Then this morning when I got up, |
| 0:47.2 | they were flat and kind of moved higher throughout the morning. The market opened 75 points |
| 0:52.7 | went higher throughout the morning and then here we 75 points went higher throughout the morning, and then |
| 0:54.9 | here we are. Yeah, CPI comes out tomorrow morning, and so I do suspect some of it is short |
| 1:02.9 | covering in advance of the concern that there will be a very disinflationary CPI report. |
| 1:09.1 | Perhaps it is disinflationary, and markets sell off tomorrow because you get the kind of buy |
| 1:15.4 | the room or sell the news dynamic. |
| 1:17.6 | Perhaps it isn't all that disinflationary and there's some headline numbers that disappoint |
| 1:23.8 | what people are expecting. |
| 1:25.1 | Who knows? |
| 1:26.2 | But my point is only that I am quite confident a lot of what |
| 1:29.1 | happened today is some short-termism around what is going on tomorrow. And short-termism always has |
| 1:34.5 | the potential to be either right or wrong. We're 70% of the way through earnings season, and we're |
| 1:40.4 | now tracking to 5% year-over-year revenue growth and a 2.8% year-over-year earnings contraction. |
| 1:50.5 | So if the earnings season were done today, we would expect earnings to be down 2.8% from where they were a year ago, which is a tiny bit worse than expected. |
| 2:01.9 | And revenue would be up about 5%, which is a tiny bit more than expected. |
| 2:07.2 | A couple of interesting tidbits I want to share here. |
| 2:11.9 | Stratigis ran a little report over the weekend. |
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