Published on 30-08-2019 11:51:50

Author: Alastair George

Alastair George is Edison’s chief investment strategist. He has extensive experience, having worked in global markets as a fund manager and risk arbitrageur since the 1990s. With an academic background in engineering and data science, he is well versed in the data-focused analysis of financial and political events.

Consistent with the weakness in global PMI survey data, we find that a weakening trend in 2019 earnings forecasts has taken hold. We recognise that for many investors corporate fundamentals will matter less than the near-term direction of monetary policy at the present time. However, slowing economic growth does appear to be having a detrimental effect on profits momentum. On an unweighted basis, 2019 forecasts are now 10% lower than a year ago in the UK and eurozone and nearly 15% lower in emerging markets. The US has held up better with a 3% decline in earnings forecasts over the same period.

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