“safety.”If and when the economy slips into a recession, earnings and revenue will decline for companies. Given the current level of interest rates, inflation, and reversal of monetary liquidity post-pandemic, the risk of recession is higher than normal.
“The largest 10% of companies represent 62% of the overall non-financial market cap of the S&P 1500, so from a market perspective, it would appear that interest rates are not yet affecting the balance-sheet stress of the market overall.Interest coverage at the bottom 50% of S&P 1500 companies and the smallest quoted companies falling sharply from low levels.
As noted by Simon White via Bloomberg, tightening financial conditions have seen corporate bankruptcies rise by 71% since last year. If financial conditions are still elevated over the next few years, that bankruptcy risk increases markedly.“Contrary to what the mega-cap valuations might suggest, smaller companies remain the beating heart of the US economy – maybe the mega-caps are more like vampires sucking the lifeblood out of other companies.
United States United States Latest News, United States United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Airbnb and Blackstone shares rise on S&P 500 inclusion, and other stocks on the moveAirbnb, Blackstone and American Express are among the stocks in the spotlight.
Source: MarketWatch - 🏆 3. / 97 Read more »
S&P 500: Market Momentum Finally Turns PositiveMarket Overview Analysis by Craig Thompson covering: S&P 500, iShares Core S&P 500 ETF, SPDR® S&P 500, S&P 500 Futures. Read Craig Thompson's latest article on Investing.com
Source: Investingcom - 🏆 450. / 53 Read more »
Stock Market on Course to Shrug Off September SwoonStocks Analysis by Investing.com (Damian Nowiszewski) covering: S&P 500, Walt Disney Company, iShares Core S&P 500 ETF, SPDR® S&P 500. Read Investing.com (Damian Nowiszewski)'s latest article on Investing.com
Source: Investingcom - 🏆 450. / 53 Read more »