Happy Monday. Good Luck out there this week.
Global Spotlight
Glimmers of Hope for U.S.-China Trade. This week brought a bit of cautious optimism to what had seemed an ever-darkening outlook on the U.S.-China trade front.
Bolton Leaves the Trump Administration. While he was useful leverage at times because of his maximalist positions, John Bolton created difficulty for the White House when negotiations required a softening of positions to help finalize deals.
Iran: The Trump administration is considering offering Tehran some relief from U.S. sanctions, likely in the form of the French-backed $15 billion credit line proposal, in hopes of getting a meeting between Trump and Iranian President Hassan Rouhani at this month’s U.N. General Assembly.
Afghanistan: Trump’s Sept. 7 announcement that he was suspending the nearly yearlong U.S.-Taliban peace dialogue revealed the schism in his administration between Secretary of State Mike Pompeo, who supported a peace deal, and Bolton, who did not (though both men supported a partial drawdown of U.S. troops).
North Korea: Bolton’s removal is a hopeful sign for movement toward a U.S.-North Korea compromise ahead of North Korea’s self-imposed end-of-year deadline.
Implications of a New European Commission. After weeks of speculation, European Commission President-elect Ursula von der Leyen unveiled the members and portfolios of the European Union’s executive branch.
Beijing’s Energy Shake-Ups in the South China Sea. This week brought news of potential progress for Beijing’s objectives with two key energy claimants in the South China Sea: the more conciliatory Philippines and the more confrontational Vietnam.
Stratfor.com
Economic Calendar
Briefing.com has a good U.S. economic calendar for the week. Here are the main U.S. releases.
Briefing.com
Last Weeks Numbers
Review Last weeks numbers here.
Last Week in a single Graph.
Earnings
Source I/B/E/S data from Refinitiv
Aggregate Estimates and Revisions
- Third quarter earnings are expected to decrease 2.0% from 18Q3. Excluding the energy sector, the earnings growth estimate is 0.5%.
- Of the 199 companies in the S&P 500 that have reported earnings to date for 19Q3, 78.4% have reported earnings above analyst expectations. This compares to a long-term average of 65% and prior four quarter average of 74%.
- 19Q3 revenue is expected to increase 3.4% from 18Q3. Excluding the energy sector, the growth estimate is 4.6%.
- 60.9% of companies have reported 19Q3 revenue above analyst expectations. This compares to a long-term average of 60% and an average over the past four quarters of 59%.
- For 19Q3, there have been 79 negative EPS preannouncements issued by S&P 500 corporations compared to 33 positive, which results in an N/P ratio of 2.4 for the S&P 500 Index.
- The forward four-quarter (19Q4 –20Q3) P/E ratio for the S&P 500 is 17.3.
- During the week of Oct. 28, 158 S&P 500 companies are expected to report quarterly earnings.
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