Three Things to Know & Watch

Jan 31, 2022

By Bill Hornbarger, Chief Investment Officer

Three Things to Watch

  • Earnings season is in full swing. High-profile reports this week include Alphabet, Starbucks, Amazon and Ford. Through Friday, 169 S&P 500 constituents reported earnings. Of those, 128 posted positive earnings surprises with the aggregate surprise a positive 4.96%.
  • The economic calendar is highlighted by the ISM report on Tuesday and the employment report on Friday. The January jobs report could be a surprise with so many Omicron cases during the month. ISM is expected at 57.5 and the unemployment rate is expected to remain steady at 3.9%.
  • International central banks meeting this week include the European Central Bank, Bank of England, Australia and Brazil. Both Brazil and the BOE (among other central banks) have already raised rates with Australia expected to do so soon.

Three Things to Know

  • Over the last 50 years, a negative S&P 500 Index return in January was followed by an average return for the next 11 months of 6.7% versus the average rest-of-the-year return of 14% when January saw a gain. (Source: Seeking Alpha)
  • After last week’s FOMC meeting, the futures markets are now pricing in five interest rate increases in 2022. (Source: Benjamin F. Edwards)
  • Since 1977, the S&P 500 has only recovered from an intraday loss of 3.99% or greater three times: Jan. 24, Oct.6, 2008, and Oct. 23, 2008. (Source: Bianco Research)

 

The above information reflects the current opinion of the author. It is based upon sources and data believed to be accurate and reliable. Opinions and forward-looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security mentioned.