Highlights from November 2019 – Stock Markets rally; S&P 500 up 25% so far this year but S&P 500 earnings flat in third quarter this year vs last year; Germany avoids technical recession

Stock Markets Rally
Equities markets continued their rally in November, the S&P 500 gained 3.4%, the Dow 3.7% and Nasdaq Composite 4.5% during the month. Elsewhere, the Japan TOPIX gained 1.9% during the month and the UK FTSE was up 2.2% during November.

Developed market equities far outperformed emerging market equities, the MSCI emerging market index ended the month down 0.1%.
S&P 500 up 25% so far this year …
… but S&P 500 earnings aren’t growing
As third quarter (Q3 2019) earnings season came to a close, S&P 500 companies reporting (broadly) flat earnings compared to Q2 2019.
Some 80% of companies beat earnings estimates for the quarter – estimates which have consistently been cut throughout the year. So that’s how it works – under estimate and out perform. No wonder the S&P 500 up 25% so far this year.
Germany avoids technical recession
Germany narrowly avoided a technical recession, by growing 0.1% in the third quarter (Q3 2019). Q2 2019 GDP had contracted 0.2%, two consecutive periods of negative growth would have constituted a technical recession.
On an annual basis, GDP growth was just 0.5%.

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