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A Mixed Message - March 13, 2019

U.S. economic growth has moderated from Q2’s 4.4% annualized pace to 2.6% in the final quarter of 2018 (U.S. BEA).

While quirks in the data gathering process may be impacting some reports, various economic releases suggest growth has continued to slow in Q1.

  • Nonfarm payrolls grew by just 20,000 in February (U.S. BLS).
  • But the jobless rate fell to 3.8% from 4.0%.

Global woes

We’re seeing weakness in the global economy, especially in Europe and China.

  • Lackluster growth overseas can hamper U.S. exports and impact profits of U.S. multinationals.

Analysts project Q1 profits at S&P 5001 companies that conduct more than half their business at home to rise by 1.0% in Q1 (FactSet a/o March 8).

Analysts project Q1 profits at S&P companies that conduct more than half their business overseas to fall by 11.2% in Q1.

Investor’s Corner

What’s happening in the global economy is impacting bottom line results.

  • It’s generating unease among investors.

However, overseas troubles are being balanced by—

  • Continued economic growth at home,
  • A Federal Reserve that hit the pause button on rates, and
  • Signs that trade tensions are easing.

@LWMLLC