The Wall Street analysts who follow companies in the S&P 500 index SPX tend to be an upbeat bunch, but as second-quarter earnings reporting season winds down, are they too upbeat on the months ahead? A JPMorgan strategist last week said yes.
They also said next year’s profit growth wasn’t looking very good either, as the Federal Reserve pushes up borrowing costs, consumer savings dwindle and economies overseas stumble. The Federal Reserve recently said it no longer expected a recession, but instead was preparing for a “noticeable slowdown.” On Friday, Federal Reserve chair Jerome Powell, speaking from a retreat in Jackson Hole, Wyo., said the central bank was unsure whether it needed to raise interest rates more in an effort to fight inflation. The Fed has raised interest rates to discourage borrowing money in hopes inflation will fall as consumers pull back on their spending.Kolanovic said that while the U.S.