Mike Zigmont, author of the Zigmont Report, is a partner at New York-based Harvest Volatility Management, a hedge fund with over $10B AUM, offering volatility management solutions to its investor base worldwide. Mike has been publishing his daily newsletter (Monday-Friday) privately for the firm’s investors and his personal contacts in the investment business
since 2008, sending shortly after the market close.
The opinions expressed below are my own and do not necessarily represent those of Harvest Volatility Management, LLC
Quiet. The Bank of Japan and the European Central Bank made rate decisions last night and this morning respectively. They didn’t change anything and while there was a little bit of drama around the noises that Mario Draghi made (he was more dovish than expected), the equity and fixed income markets yawned. The currency markets reacted some. The Euro strengthened, which is the opposite of what you would have expected (short Euro a crowded trade?). The Yen weakened and then strengthened and finished about unchanged.
So what I’m trying to say is that two central banks didn’t do anything and only the currency markets shook, albeit not much.
We’re left watching earnings. Let’s take a look as we head towards the end of the week.
Earnings dive time
2017 Q2 Earnings season (before today’s close):
11% of the S&P 500 reporting (7/20 data)
Surprise vs Estimates
- Sales: +1.1% (7/20 data)
- Earnings: +4.6% (7/20 data)
Growth vs Prior (Y/Y)
- Sales: 4.2% (7/20 data)
- Earnings: 5.6% (7/20 data)
This is pretty good. While the beat-the-street game of expectations management continues as usual (which I loathe), the actual growth is fine.
Let’s talk about the past first.