Milan Cacic
November 24, 2023
Money Education Commentary In the news News Weekly update Weekly commentary Year In reviewQ3 EARNINGS: BETTER THAN EXPECTED
With most of the companies done reporting, the S&P 500’s third quarter earnings have risen 4.1% compared to this time last year. This was a welcome surprise after three consecutive quarters of earnings declines. It is even more surprising seeing an increase when most analysts were forecasting another decline.
The chart below shows Information Technology and Communication Services as the earnings leaders, with approximately 90% of companies in these two sectors coming in higher than forecasted. The earnings growth is still being dominated by the 10 largest companies, however, historically speaking, earnings growth in smaller companies typically follows soon after. Combine this with the fact that 5- and 10-year interest rates have dropped significantly over the past month, and we are setting up for a potential year-end rally. We deserve it!
Source : Dynamic Funds
I've also included a piece from our CIBC Economics team entitled "Jobs aplenty. Output? Not so much.".
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If you are celebrating US Thanksgiving, then happy Thanksgiving. For the rest of us, have a great weekend.
Milan