I have been commenting for several months that the broad-based earnings revisions data for the S&P 1500 names was robust and supportive of healthy equity markets, and there is NO CHANGE in this view.

Importantly, this continues to be a major support for our ongoing medium-term bullish view. My research still strongly suggests that despite the regular day to-day macro news and events that are present, the biggest story/driver for markets is that we are still in the early innings of a profit recovery that is being accompanied by unprecedented monetary and fiscal stimulus.

Broadly, there still remain three main areas of favorable earnings revision readings

1) Secular Growth/FAANG

2) Value/Cyclicals that are higher quality and generally more growthy (Capital Goods, Machinery, Semi related)

3) Value/Cyclicals that are part of deep recovery/Epicenter universe and deep commodity/industrial/consumer/interest rate cyclicals.

At the margin, the number of names in group 1 is stable while groups 2 and 3 are seeing an increase. And digging one level deeper, earnings revisions data is more or less favorable based on size.

Within Large Caps (S&P 500), the most favorable groups are Cyclicals In-Motion (1) followed by Cyclicals Recovery/Epicenter(2), and Growth(3). W...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

Disclosures (show)

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You’ve reached your limit of 2 free monthly articles. Please enter your email to unlock 1 more articles.

Already have an account? Sign In

Don't Miss Out
First Month Free