US Banks – What’s in the Price?

Posted on | by Leon Hinde

The macro-economic picture is deteriorating fast and could push the U.S. economy into recession as the Federal Reserve tightens its monetary policy to tame surging inflation, Bank of America strategists warned in a weekly research note.

Investors need to ask, what’s in the price? As you can see from the chart below, JPM has corrected over the last 6 months from $175 to $130.

JPMorgan Chase & Co, the largest U.S. bank, is expected to report first-quarter earnings on Wednesday.

Goldman Sachs Group Inc is scheduled to report first-quarter results on Thursday.

BlackRock Inc is scheduled to report first-quarter earnings on Wednesday 

Citigroup Inc reports first-quarter results on Thursday

Wells Fargo & Co reports first-quarter earnings Thursday

Morgan Stanley is scheduled to report first-quarter results on Thursday

NASDAQ – Valuation Review

Posted on | by Leon Hinde

NASDAQ’s PE ratio is now 27X forward earnings with 2022 earnings growth rate forecast at 12.3%. The recent rally is a significant extension given the move higher in interest rates.

The graph below looks at the valuation of the S&P relative to US GDP.

9/4 update: The downside momentum continues in the NASDAQ.