Wed 19 Oct 2022 - 14:00 BST

Will we get a US recession? Discussing their ‘Recession Scoreboard,’ on which an increasing number of indicators is flashing red. ‘Thou shall not rise.’ Recent events in the UK imply that the room for both fiscal stimulus and monetary tightening is limited, leading to more pressure on the British Pound

Even though the drawdown in equity markets matches a shallow recession, there was never any real capitulation. Proprietary ‘Fear & Frenzy Sentiment Index,’ incorporating 11 well-known sentiment indicators, never dipped decisively into Fear, signalling more pain may be ahead

If a solid outlook of earnings growth is included, equities are not attractively valued even as P/E ratios decline. Looking at earnings-per-share levels during recessions and major economic slowdowns and what they say about future equity market returns. In addition, FedEx, CarMax, and other companies signal the reversal of a bigger trend that puts pressure on earnings.