The stock market that is! Stocks just keep rolling along as we are now in the new trading year. The beginning of 2020 mirrors the record setting ways of 2019. The S&P 500 (see chart here) broke the 3,300 mark for the first time ever today. The Dow Jones Industrial Average (see chart here) is trading above 29,000, the Nasdaq Composite (see chart below) appears to be on its way to 10,000 and the small-cap Russell 2000 (see chart here) is approaching its all time record high.
As I have eluded to in my blog over the past years, this market tear is something no one has really witnessed. Actually all of this started since the crash of 2008. Who could of ever imagined back then that the Dow Jones Industrial Average would flirt with the 30,000 level? In fact, markets around the world were on the verge of collapse and banks were bracing for a bank run. My goodness how times have changed. This breath taking run started with the Federal Reserve dropping rates to record lows and buying up debt. To this day the Federal Reserve is still playing a critical role in this record setting stock market which is a big reason why the markets just keep rolling.
Now it is up to corporate America to show their chops. Earnings reporting season is kicking off and if the report cards are anything like what Morgan Stanley reported today, the bulls will continue to eat caviar. Morgan Stanley (NYSE: MS) had revenues of over $10B exceeding all expectations. In fact, earnings reporting season is off to a strong start with the majority of companies who have reported so far have exceeded street estimates. Now in fairness earnings expectations have been ratcheted down by analysts but still it is undeniable that corporate earnings are still showing strength. This is just the beginning of reporting season so let’s see how the coming weeks look as we continue to set record highs. Good luck to all 🙂