Earnings – Corporate Sentiment vs. Quarterly EPS YoY (Leading Indicator) Corporate sentiment tends to lead earnings growth by 3 months, suggesting earnings downside risk. Image: BofA Global Research
Sentiment – NAHB Housing Market Index U.S. homebuilder sentiment continues to fall. Image: BofA Global Research
Seasonality – Average Daily Return for S&P 500 and Level for VIX Seasonality suggests that the S&P 500 tends to move lower with higher volatility over the next few months. Image: Topdown Charts
Probability of U.S. Recession in the Next Four Quarters The Morgan Stanley’s recession probability model is fast approaching a point of no return. Image: Morgan Stanley Research
Inflation – U.S. Headline CPI YoY Change and Estimated CPI Will U.S. inflation fall below 5% in February 2023? Image: Morgan Stanley Wealth Management
S&P 500 and Manufacturing PMI Will PMIs continue to head lower and drive the S&P 500 down? Image: Morgan Stanley Research
U.S. 10Y-3M Yield Curve and Fed Funds Target Rate Historically, the Fed doesn’t pivot policy until a recession arrives and the 10Y-3M US Treasury yield curve inverts. Is it really different this time? Image: Morgan Stanley Wealth Management
Inflation – Fed Funds Rate Less Core PCE vs. Fed Funds Rate It seems unlikely that the Fed will pause before the federal funds rate rises above the core PCE rate. Image: Morgan Stanley Wealth Management
Fed and Dow Jones Industrial Average Is the bear market far from over as recession risks mount? Image: BofA Global Investment Strategy
Inflation – U.S. Headline CPI and 1-Year and 2-Year Breakevens Is the surge in U.S. inflation transitory? Image: Alpine Macro
Emerging Markets vs. U.S. Financial Conditions Historically, tightening financial conditions do not bode well for emerging markets. Image: Richardson Wealth