Yield Curve is No Longer Inverted – Does Anyone Care?

Two months ago, the yield curve ‘inversion’ was one of the most cited data points for recession worries. And for good reason – sustained yield curve inversions have preceded nearly every recession in the post-World War II era. Considering that pockets of U.S. macroeconomic data were showing weakness around the same time as the inversion, […]

City Revenues are Slowing—Another Recession Signal?

A report this week from the National League of Cities caught my attention. In it, 63% of finance officers from major U.S. cities predicted a recession as soon as 2020.1 A perfect storm of falling city revenues, rising expenditures, softening business investment, and a housing market that feels like it’s plateauing. The question is – […]

Are Corporate Earnings in Recession?

With all the recent talk on weak manufacturing numbers, endless trade wars, and the impeachment inquiry, few commentators have pointed out that we may be in the midst of a technical earnings recession. And given the high value we place on corporate earnings here at Zacks Investment Management, this is a factor we’re most certainly […]

Are Investors Pricing in Too Much Recession Risk?

October kicked off with some weak economic reports. The Institute for Supply Management released manufacturing data showing that U.S. factory activity continued its slump, with the manufacturing index falling to its lowest level (47.8) since June 2009. Global manufacturing activity also remained firmly in negative territory in September, posting its fifth consecutive month of contraction. […]

Signs Point to Volatile Markets, but Not Yet to Recession

The U.S. and global equity markets got shaken up a bit last week, with weak manufacturing numbers in the U.S. and globally indicating pronounced slowdowns in factory activity, employment, and trade. The manufacturing sector is very globally interconnected, with very few sophisticated products being assembled in a single country, so the synchronized slowdown comes as […]

2019 Tech IPOs: Where Are The Earnings?

In last week’s Mitch on the Markets column, I made the case that market pullbacks could boost the case for technology stocks. I elaborated by pointing specifically to strong price-to-cash flow metrics for some of the best names in the tech sector (relative to the S&P 500), while underscoring robust return on equity (ROE). Though […]

The Case for Long-term Tech Stock Ownership

It’s no secret that technology stocks, led by FAANG,1 have been posting strong positive gains in this bull market. Investors probably hear about the outperformance all the time, which might lead you to reasonably conclude that technology stocks are not cheap.  You’d be right – technology stocks trade at more than a 10% premium to […]

Oil Shocks and the Future of Energy Investments

The oil markets were rattled last weekend (and into Monday) when news reports confirmed that Saudi Arabia’s oil giant, Aramco, had suffered attacks at their Abqaiq oil-processing facility. The destruction removed some 5.7 billion barrels a day out of production, which represents approximately half of Saudi Arabia’s total output and nearly 5% of global supply.1 […]

Embracing Fear in the Stock Market

Concerns are growing about the strength of the U.S. economy and the longevity of the bull market. Many readers may notice that “recession” seems to be the hottest trending topic in the news these days, with any bit of negative data being seized upon as a potential canary in the coal mine. I’ve even written […]

The Perils of Moving Investments to Cash

U.S. and global equity markets have been in a sustained volatile patch since early summer, and a look at the S&P 500 over the last year demonstrates how the ups and downs have netted flat returns. Whether you want to blame the trade war, slowing corporate earnings growth, weakening China and European economic fundamentals, the […]