Markets are screaming higher today on the prospects of ECB/FOMC action.
The concern whent hat wears off is what ahppens with Q3 & Q4 profit. UBS chief U.S. equity strategist is concerned about an “Earnings Recession” coming to the US, as illustrated in the chart above.
The Standard & Poor’s 500’s non-financial companies slipped in Q2 and may drop again in the next few quarters. What concerns Golub are potentially the first back-to-back declines since 2009, according to his data. “It’s very hard for the market to move forward when earnings aren’t progressing,” he wrote.
His 2012 estimate or the SPX is 1,375, or 2.1% below yesterday’s close.
His SPX earnings estimate is $102.50 a share for 2012, and $107 for 2013.
By David Wilson
September 09, 2012