Market Update: Wed, Jan 15, 2020 | LPL Financial Research

Daily Insights

Signing day. It’s the scheduled signing day for the U.S.-China phase-one trade agreement, but details of the deal seem to be disappointing global markets. Current tariffs on Chinese imports will likely remain unchanged until later this year, and there are no details in the pact on future talks, according to reports. Chinese stocks are lower for a second day, and U.S. stocks, weighed down by some mixed earnings results this morning, opened lower.

Earnings results trickle in. Investors have a stream of fourth-quarter earnings reports to digest, which should give some direction to stocks. Our expectations are for a marginal increase in S&P 500 Index earnings per share (EPS) on a year-over-year basis, based on current FactSet consensus estimates (-2% year over year) and the average historical upside of roughly 3 percentage points. We’ve become accustomed to meager earnings growth, but we need to see some upside in profits this year. We’ll highlight our 2020 earnings expectations today on the LPL Research blog.

Pulling it forward. In the newest Market Signals podcast, Pulling It Forward, LPL Research strategists talk about the possibility of 2020 gains and new jobs possibly being pulled forward into 2019. They also cover the impact of geopolitical concerns on stocks, earnings reports, and what the first 5 days of January may tell us about the rest of 2020.

 

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