Earnings growth will be harder to come by in 2019, however, said David Kostin, chief U.S. equity strategist at Goldman Sachs. In a note to clients this weekend, Kostin said 2019 earnings growth could be as low as 3 percent as the economy slows, the dollar rises in value and oil prices remain low.
The calendar fourth-quarter earnings season kicked off on Monday, with Citigroup reporting stronger-than-expected earnings. However, the bank also said its fixed-income trading revenue fell 21 percent.
The moves Monday come after the major indexes posted solid weekly gains last week. The Dow and S&P 500 also notched three-week winning streaks. Equities kicked off 2019 with strong gains, rebounding from a sell-off in December that briefly sent the S&P 500 into bear-market territory.
However, DataTrek Research co-founder Nicholas Colas is not sold the market is out of the woods yet.
“We are chalking up the S&P 500’s YTD gain of 3.6% primarily to the cessation of tax loss selling in the New Year,” Colas wrote in a note to clients. “That list of the biggest S&P 500 losers in 2018 we published last month is up an average of 9.5% YTD, a data point which supports this idea.”
“From now on, US stocks will have to earn further gains. Earnings season kicks off this week, the market’s first challenge. US/China trade will likely have to wait for Davos, which is 9 days away,” he added.
Investors were also worried after fresh data out on Monday showed December exports and imports dropping unexpectedly in China. These figures deepened concerns of a slowdown in the world’s second-largest economy.
—CNBC’s
Silvia Amaro
contributed to this report.
from Viral News Reports http://bit.ly/2QJXfkF
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