Denominator Blindness (Ep. 124)

Summary:

In the latest episode of Facts vs Feelings, Ryan Detrick, Chief Market Strategist, and Sonu Varghese, VP, Global Macro Strategist, break down the latest market trends, inflation data, and what’s driving stocks to all-time highs despite ongoing concerns about tariffs, interest rates, and other economic uncertainty.

Key Takeaways:

• Markets at All-Time Highs: Despite concerns about tariffs, inflation, and the Fed, stocks are still hitting record levels, driven by strong earnings and expanding profit margins.
• Rate Cuts Still on the Table: Recent inflation data supports the case for potential Fed rate cuts in 2025, but timing remains uncertain.
• Earnings Strength: S&P 500 earnings are up nearly 17% YoY, with eight of 11 sectors improving profit margins—an encouraging sign for investors.
• Tariffs Delayed: Proposed trade tariffs have been delayed, possibly until August, easing immediate market fears.
• Market Breadth Expanding: More sectors are driving growth beyond just large-cap tech, making the rally more sustainable.
• Inflation Trends: CPI came in hot, but PPI showed signs of easing price pressures, hinting at continued disinflation.
• Momentum Matters: Historically, strong market performance in January and February—like we’ve seen to start 2025—leads to continued gains for the rest of the year.
• Consumer Resilience: While retail sales dipped unexpectedly, seasonal factors and extreme weather likely played a role, rather than fundamental economic weakness.

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

Connect with Ryan: 

• LinkedIn: Ryan Detrick
• X: Ryan Detrick

Connect with Sonu: 

• LinkedIn: Sonu Varghese
• X: Sonu Varghese

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