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Market Update: 7-10-17

Jerris Wealth Management Group LPL Research Weekly Market Update

SECOND QUARTER 2017 EARNINGS PREVIEW Q1 A TOUGH ACT TO FOLLOW

Burt White Chief Investment Officer, LPL Financial | Jeffrey Buchbinder, CFA Market Strategist, LPL Financial

Earnings season is underway this week (July 10–14) and may be another good one, with double-digit S&P 500 Index earnings growth possible. But getting to double digits will be tougher than it was in the first quarter when S&P 500 earnings increased more than 15% year over year.

First quarter earnings season will be a tough act to follow as the year-over-year comparison gets more challenging. The first quarter of 2016 was the trough of the earnings recession, so the first quarter of 2017 had the easiest annual comparison. Growth improved (fell less) in the second quarter of 2016 as corporate America began to emerge from the earnings recession, lifting the base for comparison for the just-completed second quarter. This trend will continue over the rest of 2017 given the earnings growth acceleration achieved during the third and fourth quarters of 2016 [Figure 1].

Market Update: 6-26-17

Jerris Wealth Management Group LPL Research Weekly Market Update

A TECHNICAL CHECK-IN
THE GLOBAL BULL LOOKS STRONG

Burt White Chief Investment Officer, LPL Financial | Ryan Detrick, CMT Senior Market Strategist, LPL Financial | Dave Tonaszuck, CMT Technical Strategist, LPL Financial

The global equity bull market is alive and well, with very broad participation. Longer-term technicals continue to look very healthy and strong, even as the bull market and economic recovery in the U.S. turns eight years old. A closer look at key indexes suggests the path of least resistance remains higher for stocks, although it likely won’t be an easy ride, as volatility could creep higher during the second half of 2017.

Market Update: 6-19-17

Jerris Wealth Management Group LPL Research Weekly Market Update

MIDYEAR OUTLOOK 2017 BUSINESS FUNDAMENTALS BACK AT THE CONTROLS

Burt White Chief Investment Officer, LPL Financial | Jeffrey Buchbinder, CFA Market Strategist, LPL Financial

We forecast 6–9% returns for the S&P 500 Index in 2017. As investors increasingly trust that the economy can stand on its own without the need of monetary policy support, business fundamentals should take over as the primary market engine and corporate profits will take on increasing importance. We have slightly raised our 2017 S&P 500 Index total return forecast to 6–9%, commensurate with expected earnings gains.

Market Update: 6-12-17

Jerris Wealth Management Group LPL Research Weekly Market Update

HURDLING OVERSEAS EARNINGS WHAT DO THE FORECASTS TELL US?

Burt White Chief Investment Officer, LPL Financial | Matthew E. Peterson Chief Wealth Strategist, LPL Financial

Overseas earnings were even better than expected during the first quarter (Q1) of 2017. Global equity analysts were looking for strong earnings growth from overseas companies after years of flat to declining earnings; for the most part, those markets delivered. Stock markets themselves responded, with international markets generally outperforming the S&P 500 Index. Frequently after earnings are released, analysts may reduce future growth expectations, often based on conservative comments from companies as they manage expectations. However, earnings expectations only decreased modestly during this period, and actually increased further for some regions. It is great to see continued optimism on corporate fundamentals, but it could prove challenging for companies to outpace expectations again.

Market Update: 6-5-17

Jerris Wealth Management Group LPL Research Weekly Market Update

MASTER LIMITED PARTNERSHIP
MORE GOING ON THAN OIL PRICE

Burt White Chief Investment Officer, LPL Financial | Matthew E. Peterson Chief Wealth Strategist, LPL Financial

Master limited partnerships (MLP) appear to be a natural way to invest in the changing energy landscape. MLPs are exclusively focused on energy infrastructure in the United States and Canada. North American energy production has become a dominant factor in the price of oil and in the North American drive to be energy independent. Yet, the pricing and performance of MLPs can be complicated, influenced by systemic factors, such as the prices of oil and gas, interest rates, and movement in the equity markets. MLPs are also influenced by the degree of success of each individual partnership, in the same way that traditional stocks’ performances are determined by both market and individual factors. Despite recent performance, we believe that the sector may still represent a good long-term investment option to potentially profit from increased North American energy production.

Market Update: 5-30-17

Jerris Wealth Management Group LPL Research Weekly Market Update

CORPORATE BEIGE BOOK: IT KEEPS GETTING BETTER

Burt White Chief Investment Officer, LPL Financial | Jeffrey Buchbinder, CFA Market Strategist, LPL Financial

After a very strong first quarter earnings season, we expected to see management sentiment also improve. And similar to how earnings results and the guidance from management were better than we expected, so was our measure of corporate sentiment based on earnings conference call transcripts, which we call our Corporate Beige Book. We saw a sharp increase in the strong and positive words over the prior quarter, with no change in the weak and negative words. There was virtually no talk of recession — as expected — and far less attention was paid toward potential policy changes out of Washington, D.C.

Analysis of earnings conference call transcripts from calls that took place starting in mid-April extending into the third week of May.

Our Team

Susan Jerris

Susan
Jerris

LPL Registered Principal 
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Anthony Roble

Anthony
Roble

LPL Registered Administrative Assistant
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CA Insurance License #0K61923
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Diana Esperon

Diana
Esperon

Administrative Assistant
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