Au Revoir, Trade War (Ep. 146)

In the latest episode of Facts vs Feelings, Ryan Detrick, Chief Market Strategist, and Sonu Varghese, VP, Global Macro Strategist, discuss the recent easing of global trade tensions and how markets have responded positively. They dive into three popular market myths currently being debated, analyze corporate earnings, and provide their reasoning on why stocks continue to perform well despite skepticism.

Key Takeaways:

• Trade War Cooling: New trade agreements with the EU, Japan, and other nations signal a potential end to President Trump’s trade war, providing stability and optimism to the markets.
• Market Myths Debunked:
   
  • Weak Market Breadth: False. Equal-weight indexes and sector-wide gains show the market rally is broad-based. 
  • Margin Debt Fears: Exaggerated. While margin debt reached record levels, relative to market cap it remains historically manageable. 
  • Foreign Investment Fears: Unfounded. Foreign investment into U.S. stocks and bonds is strong, contrary to earlier warnings.
• Corporate Earnings Strength: Companies like Johnson & Johnson and 3M show improved earnings forecasts despite tariff impacts, highlighting resilience in U.S. corporate profits.
• Sentiment Check: Despite market highs, public sentiment remains cautious, which historically aligns with continued market strength.

Connect with Ryan:

• LinkedIn: Ryan Detrick

• X: @ryandetrick

Connect with Sonu:

• LinkedIn: Sonu Varghese

• X: @sonusvarghese

Questions about the show? We’d love to hear from you! factsvsfeelings@carsongroup.com

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