| Amir Kahanovitz, Chief Economist, Phoenix-Excellence |
The reporting season for the first quarter in the US is now starting and will shed light on the roller coaster that has run over the market since the beginning of the year. A survey of fund managers conducted by Bank of America shows a record number since March 2020 of investment managers estimating that we are going to be disappointed.
One notable expectation of disappointment is Morgan Stanley (NYSE 🙂 bear stock strategist Mike Wilson, who claims that the celebration of smuggling everyone from bond to stock has reached a turning point where its damage to profitability is growing in terms of pricing.
We may have received support for this last night from the president of the Fed’s branch in St. Louis, Bollard, who said that even a triple in any decision, of 75 bp, is possible.
In addition, in addition to the jump in commodity prices, which includes a price of oil again at $ 109, companies have also recently faced a critical shortage of workers (which comes with rising wages), and supply chain disruptions, which also stem from hypochondriac China pursuing its illusory Corona zero policy.
Wilson estimates the disappointment from the reporting season may not yet be reflected in the quarterly results but in forecasts for future profitability.
And yet it is possible that the growing fears of disappointment from the reporting season stem from over-conservatism, rather than a low chance that the markets are overpriced.
In practice, the current macro data from the US actually surprised economists’ forecasts, according to the ‘City Macros Surprise Index’.
Recent figures that stood out favorably were, for example: on Friday, the New York Industrial Survey (the “Empire”), which rose to 24.6 points compared to expectations for one point, the American, which jumped in March by 0.9%, compared to expectations of a 0.4% increase. Got an update upstairs for February as well.
On Thursday, the important surprise of the important University of Michigan stood out, rising from 59.4 to 65.7, even though the expectation was generally down to 59.0. Earlier on Thursday, a figure for February was published whose figure for February was updated from more than 0.3% to 0.8%.
Does the pessimism of economists that has been found to be excessive also reflect a high chance of over-pessimism of investment managers?
Meanwhile in our country, despite the exodus of Israelis abroad to foreign exchange spending, the shekel continues to show strength against the currency basket, a strength that is especially noticeable in light of the jump in the world dollar. Maybe next holiday the Bank of Israel will help those going abroad to weaken the shekel, distribute foreign currency swaps at the counters at Ben Gurion Airport, go out and help the country!
Similar to the strong shekel, the domestic stock market continues to be a global star, in general a celebration. The IMF will release its quarterly economic forecast today, after the World Bank lowered its forecast for global growth yesterday, but we have a reasonable suspicion that we will be pleasantly surprised by our GDP per capita forecast in current dollar terms for 2022.
A good ranking by Israel could also improve Lieberman’s mood, which must be turning around frustrated when the rise in the price of oil washes over him the reduction of the festive excise tax.
The author is the Chief Economist of Phoenix-Excellence. This review is provided as a service to readers only, and should not be construed as an offer, recommendation, substitute for the reader’s professional judgment or investment advice or investment marketing, purchase and / or sale and / or holding of the securities and / or financial assets mentioned or of securities and / Or any other financial assets.