Earnings Build; GDP Slows

November 2, 2021

A fresh wave of positive corporate earnings surprises sent markets to new record highs last week.

The Dow Jones Industrial Average increased 0.40%, while the Standard & Poor’s 500 rose 1.33%. The Nasdaq Composite index picked up 2.71% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, was up 0.68%.^1,2,3

Earnings Drive Market

The week kicked off with the Dow Jones Industrials and S&P 500 index setting record highs as the financial markets carried over the previous week’s price momentum.⁴

Stocks continued to climb on a string of forecast-beating earnings results. With about half of the S&P 500 constituent companies having reported earnings, more than 80% of them have beaten Wall Street analysts’ consensus estimates. Based on these results, earnings for all S&P 500 companies are expected to come in approximately 39% above the third quarter of last year. (Forecasts are based on assumptions, and may not materialize.) Stocks overcame disappointing earnings from two mega-cap tech names on Friday to maintain the week’s solid gains.⁵

GDP Growth Slows

While businesses managed to post strong earnings in the third quarter, the first look at economic growth came in below consensus estimates. The Gross Domestic Product (GDP) grew at a 2.0% annualized rate in the third quarter, a slowdown from the two previous quarters, each of which posted annualized growth rates in excess of 6%.⁶

The spread of the Delta variant and backlogs in the supply chain were two major factors dragging on economic activity.

This Week: Key Economic Data

Monday: ISM (Institute for Supply Management) Manufacturing Index.

Wednesday: ADP (Automated Data Processing) Employment Report. Factory Orders. ISM (Institute for Supply Management) Services Index. FOMC (Federal Open Market Committee) Announcement.

Thursday: Jobless Claims.

Friday: Employment Situation.

^{Source: Econoday, October 29, 2021
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Monday: Simon Property Group, Inc. (SPG).

Tuesday: Pfizer, Inc. (PFE), Activision Blizzard, Inc. (ATVI), Amgen, Inc. (AMGN), Marathon Petroleum Corporation (MPC), ConocoPhillips (COP), Prudential Financial (PRU), Mondelez International, Inc. (MDLZ), TMobile US, Inc. (TMUS), The Estee Lauder Companies, Inc. (EL).

Wednesday: CVS Health Corporation (CVS), Qualcomm, Inc. (QCOM), Electronic Arts (EA), Humana, Inc. (HUM), Booking Holdings, Inc. (BKNG), Match Group, Inc. (MTCH), Emerson Electric (EMR).

Thursday: Square, Inc. (SQ), Albemarle Corporation (ALB), Southern Companies (SO), Cigna Corporation (CI), Skyworks Solutions, Inc. (SWKS), Regeneron Pharmaceuticals, Inc. (REGN).

Friday: DraftKings, Inc. (DKNG).

^{Source: Zacks, October 29, 2021
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

MARKETS ENTHUSIASTICALLY SHAKING OFF OCTOBER VOLATILITY - BRING ON NOVEMBER!

The HCM-BuyLine® is positive and has built back a lot of strength after the selloff in late September/early October. The S&P 500 is hitting resistance and probably needs a few trading sessions to break on through. ⁹

READ MORE HERE

WATCH VANCE ON CNBC WORLDWIDE EXCHANGE

^{This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice.} 

Do a Paycheck Checkup

Every year, the IRS suggests doing what it calls a “Paycheck Checkup.” Check your withholding status if you:

• Get married or divorced
• Give birth to or adopt a child
• Buy a house
• Retire
• File for bankruptcy
• Get a new job or lose a job

The IRS also suggests checking on any streams of taxable income that are not subject to withholding, such as interest, dividends, capital gains, self-employment income, or retirement plan distributions. You also should check your withholding if you’ve experienced changes to your medical expenses, taxes, charitable gifts, education credits, dependent care expenses, and more. These life changes might affect your deductions or tax credits. Paycheck Checkups may help you better manage the process of filing taxes. ⁷

^{* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.}

Rest, Relaxation, and Healthy Nutrition

Here are some tips on how to stay healthy, even during holiday trips:

• Before heading to the airport, pack a snack box of fruits, veggies, nuts, lean proteins, and healthy bars. This way, you won’t be tempted by chips and soda while you wait for your flight.
• Get plenty of sleep. Just like at home, it’s really important to get a good night’s sleep while traveling. Sleep helps your body reset for the next day and will help you maintain your weight.
• Hydrate often.
• Take your vitamins to ensure you’re at your best. A daily pill organizer can help you remember to take them, even while traveling.

There’s no reason why you must sacrifice all your hard work and healthy habits while visiting family or heading to warmer destinations during the holidays. If anything, continuing a healthy lifestyle while traveling will help you have even more fun! ⁸

Fall Harvest Honeycrisp Apple and Kale Salad

Servings: 6

Time: 30 Mins

Ingredients

• 1 tablespoon extra virgin olive oil
• 1 tablespoon real maple syrup
• 1/3 cup raw pepitas
• 1/4 teaspoon ground cinnamon
• 3 ounces thinly sliced prosciutto
• 2 heads kale, shredded
• 2 honey crisp apples, thinly sliced
• arils from 1 pomegranate
• 1/2 cup crumbled feta cheese

Cider Vinaigrette

• 1/3 cup extra virgin olive oil
• 1 shallot, thinly sliced
• 2 tablespoons apple cider vinegar
• 1 tablespoon fig preserves
• 1 tablespoon fresh thyme leaves
• kosher salt and pepper
• 1 pinch crushed red pepper flakes

Directions

1. Preheat oven to 375° degrees F.  Line a baking sheet with parchment paper. 
2. On the prepared baking sheet, toss together the pepitas, olive oil, maple syrup, cinnamon, and a pinch of salt. Arrange in a single layer. Lay the prosciutto flat around the pepitas. Transfer to the oven and bake for 10-15 minutes or until the pepitas are toasted and the prosciutto is crisp.
3. Meanwhile, in a large salad bowl, combine the kale, apples, and pomegranates.
4. To make the vinaigrette. Heat the olive oil in a medium skillet over high heat. When the oil shimmers, add the shallots, cook until fragrant, 2-3 minutes. Remove from the heat, let cool slightly. Add the apple cider vinegar, fig preserves, and thyme. Season with salt, pepper, and crushed red pepper flakes. 
5. Pour the vinaigrette over the salad, tossing to combine. Top the salad with toasted pepitas, prosciutto, and feta. Eat and enjoy! ¹⁰

Stay safe!

Footnotes and Sources

^{1. The Wall Street Journal, October 29, 2021}

^{2. The Wall Street Journal, October 29, 2021}

^{3. The Wall Street Journal, October 29, 2021}

^{4. CNBC, October 24, 2021}

^{5. CNBC, October 28, 2021}

^{6. The Wall Street Journal, October 28, 2021}

^{7. IRS.gov, January 22, 2021}

^{8. travelandleisure.com, June 24, 2021}

9. Howardcm.com, October 14 , 2021

10.halfbakedharvest.com, September 20, 2018

^{Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.}

^{The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.}

^{This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.}

^{Copyright 2021 FMG Suite.}

McCarthy Financial Group's Blog: Market Insights & Wealth Watch