Move On: March 25, 2023

Good morning and welcome to the Weekender for Saturday, March 25, 2023. US equity markets, as measured by the S&P 500, were higher by 1.4% this week, the second consecutive week of gains. Over the last fortnight, financial markets rose in the face of two narratives: bank failures and their potential systemic contagion and growing expectations of an economic recession. Despite difficulty digesting these potentially negative narratives, markets have, instead, decided to swallow them hard and move on. But “moving on” means focusing on fundamentals, like poor corporate earnings, deteriorating profit outlook and persistent inflation. Damned if you do. Damned if you don’t.

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