The S&P 500 and Dow Jones hit new record highs on Monday, while the Nasdaq rose 0.9%, driven by gains in tech stocks.
The earnings season kicks into high gear this week with major companies like UnitedHealth, J&J, Bank of America, Goldman Sachs, and Netflix reporting results.
Tech was the standout performer, with Nvidia leading gains in chipmakers and Apple benefiting from a positive analyst call.
Key megacap stocks such as Apple (1.7%), Nvidia (2.4%), Microsoft (0.7%), and Alphabet (1.1%) saw solid gains, while Broadcom and Tesla rebounded from sharp losses.
Year-to-date, the weekly Gryning Signals (more info here) are up 26.1% (equal allocation, no leverage) versus a gain of 23.1% for the SPY, GLD is up 28%, QQQ has gained 21%, UUP is up 6.4%, and long-duration bonds (TLT) are down 2.4%.
JP Morgan kicked off Q3 earnings season on Friday, beating on both EPS and revenue expectations. We'll hear from more of the big banks today.
Once again, the expectations bar for S&P 500 earnings growth has been set low by Wall Street. The estimate for the quarter has been revised down to just 4.1%.
And this comes in a quarter that the Atlanta Fed projects the economy to have grown at 3.2% — and in a quarter that ended with what is considered to be a hot jobs report. So once again, we head into earnings season with a setup for positive surprises.
As for the banks, remember last week we talked about Jamie Dimon's comment surrounding AI and the "backlog for IPOs." We looked at the parallels between the current environment and the late 90s boom, both of which had the driver of a technology revolution.
If history is our guide, we should expect a coming boom in IPOs.
Let's revisit how the late 90s IPO boom influenced the Wall Street kings of underwriting (with emphasis on the performance from the first Fed rate cut up to the March 2000 stock market peak).Â
Here's JP Morgan, Citibank and Morgan Stanley…
And no one was responsible for more IPO underwriting volume in that era than Goldman Sachs. They went public in 1999, in the height of the frenzy - the stock went up 60% in 10 months, before the stock market topped in March of 2000.
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