Market Update: Mon, Nov 18, 2019 | LPL Financial Research

Daily Insights

Big week for retailers. Third quarter S&P 500 Index earnings growth is tracking to a 2.3% year-over-year decline, nearly 2 percentage points above the September 30 estimate with about 470 S&P 500 companies having reported. S&P 500 earnings estimates for the next 12 months have fallen 1.7% since September 30 amid tariffs, ongoing policy uncertainty, U.S. manufacturing weakness, and slow international growth. This week, another 15 S&P 500 companies report results, including several leading retailers.

Earnings-dashboard-11.18.19

Six weeks of gains. U.S. stocks are little changed this morning, taking a break from the steady uptrend we’ve seen in the S&P 500 recently. The benchmark has climbed for six straight weeks, its longest streak since November 2017, and it hasn’t posted consecutive declines since October 8. U.S. equities have been extra sensitive to headlines recently with third quarter earnings season winding down. Investors should be prepared for periodic volatility with U.S. indexes near record highs.

Recession Watch. Some economic indicators suggest the bull market might be running out of steam, while others suggest we may have more room to run. Our outlook is still optimistic, but we don’t want to be complacent, so we take a look at economic data for any late-cycle or recessionary signals in this week’s Weekly Market Commentary.

More Highs on Trade Optimism. U.S. stocks rallied for the sixth consecutive week last week, and economic data showed that consumers continue to spend. U.S. fixed income climbed, and the U.S. dollar edged lower. We review all the major equity, sector, fixed income, currency, and commodity indexes in Weekly Market Performance, dated Nov. 15.

The week ahead. In the week ahead, investors will get a look at housing data, Federal Reserve policy meeting minutes, the Conference Board’s Leading Economic Index (LEI), consumer confidence, and the Markit manufacturing and services Purchasing Managers’ Index (PMI) surveys.

LPL Research on CNBC’s Squawk Box. LPL Financial Senior Market Strategist Ryan Detrick was on CNBC this morning to discuss the potential for a year-end rally and the global bull market. You can watch the full interview here.

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