Swerving a recession?recently brought its estimate for this possibility to the 15% level of any standard year. The bank has long called for a"soft landing."
"That being said, alternative investments are looking attractive — cash, bonds — and that reduces the relative attraction of equities, and, also, I think we have to acknowledge we're not seeing much in the way of profit growth, so selectivity, I think, is still going to be crucial in a relatively moderate index environment."
Faller noted that there are some"pain points," with 30-year fixed mortgage rates hitting a 22-year high in the U.S. in August, and with credit card delinquencies ticking up from their very low base, along with the end of the student debt moratorium. "Rather, more of the changes seem to be happening at the margin, as consumers are shifting away from brand names and toward some thriftier options, and reorienting back toward goods after a red-hot year for services that were disrupted by COVID."The prevailing theme of the latest earnings season was upside surprises, with S&P 500 earnings contracting by circa 4% ,versus the 7.3% slide expected heading into the quarter, according to JPMorgan Private Bank.