Tensions in Ukraine remained at the forefront for investors. But do not let this be the only thing you watch.
The Federal Open Market Committee is expected to raise the target range for the federal funds rate by 25 basis points (to 0.25%-0.50%) and to signal that further rate increases are likely on their way. Why? The Consumer Price Index rose .8% in February. Up 7.9% y/y. All Core CPI component indexes rose over the last year. To say the least, Inflation is a problem for not only citizens in the U. S. but the world.
Here are some points to remember this week.
- Crossing Ukraine is like going from St. Louis to the Atlantic.
- China is Ukraine’s biggest export market, as well as its top supplier.
- Europe and China together account for 85% of Russia’s oil exports.
- US gasoline prices were already climbing before the war.
- Wheat-importing nations are about to have problems.
Happy Monday. Good Luck out there this week.
Global Spotlight
Russia’s war in Ukraine continues. Russian forces will likely try to return to large-scale offensive operations after several days of relatively modest movement.
France terminates its COVID-19 health pass. March 14 will mark a milestone in France’s push to leave the COVID-19 pandemic behind, as on that date people will no longer be required to show a COVID-19 vaccine passport to access public venues and face masks will also no longer be needed indoors except on public transportation.
The German chancellor meets with the Turkish president as the war in Ukraine continues. German Chancellor Olaf Scholz will travel to Turkey to meet with Turkish President Recep Tayyip Erdogan on March 14 to discuss regional affairs, most notably the Russian invasion of Ukraine.
The Fed rate hikes begin. The U.S. Federal Reserve is likely to increase its interest rate target by 25 basis points at the March 15-16 Federal Open Market Committee meeting as the Ukraine crisis, rent increases and high commodity prices continue to drive inflation (which hit 7.9% in February, the highest level since January 1982).
Colombia holds legislative elections. Colombia will hold legislative elections March 13 for both houses of its Congress. The election will kick off the country’s busy electoral calendar, which includes two rounds of presidential elections in May and June.
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.
Earnings
Source I/B/E/S data from Refinitiv
Aggregate Estimates and Revisions
- 21Q4 Y/Y earnings are expected to be 32.0%. Excluding the energy sector, the Y/Y earnings estimate is 23.4%.
- Of the 493 companies in the S&P 500 that have reported earnings to date for 21Q4, 76.5% have reported earnings above analyst estimates. This compares to a long-term average of 65.9% and prior four quarter average of 83.9%.
- 21Q4 Y/Y revenue is expected to be 15.1%. Excluding the energy sector, the growth estimate is 10.9%.
- During the week of Mar. 4, 3 S&P 500 companies are expected to report quarterly earnings.
Macro Market
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Since the beginning of the year, the SP 500 has been marching in a downward trajectory. As Carter Worth says on CNBC, you can draw the lines anywhere, but here is where I draw mine. A firm downward trend down is established. So, when a long opportunity presents itself, make sure you look at the overall market to make sure it makes sense. As a review, the top 5 SP500 (AAPL, MSFT, AMZN, FB, GOOGL)
