2020 is off to a roaring start, picking up right where 2019 left off. Many investors are eyeing the upcoming presidential election as an impending storm for the stock market. In the four-year presidential cycle, pre-election years have tended to be the strongest for stocks, as sitting presidents have taken measures to boost the economy and stock market higher to garner votes. It sure worked out well last year, with the S&P 500 Index’s 31% total return.

Returns in election years, however, have been quite bifurcated.

“If an incumbent president was up for reelection, stocks tended to do extremely well,&r

A milestone in the U.S.-China trade dispute has boosted corporate sentiment, according to the Federal Reserve’s (Fed) latest Beige Book.

In the Beige Book, the Fed presents qualitative observations made by community bankers and business owners—or “Main Street”—about economic (housing, labor market, manufacturing, nonresidential construction, prices, tourism, wages) and banking conditions (lending conditions, loan demand, loan quality). At LPL Research, we maintain an indicator called the Beige Book Barometer (BBB) to gauge Main Street’s sentiment by looking at how frequently key words and phras

Fourth quarter earnings season kicked off this week with 24 S&P 500 Index companies slated to report results. Our expectations are for a marginal increase in S&P 500 earnings per share (EPS) on a year-over-year basis, based on current FactSet consensus estimates (-2% year over year) and the average historical upside of roughly 3 percentage points.

We’ve become accustomed to meager earnings growth. As shown in the LPL Chart of the Day, if fourth quarter results are anywhere near expectations, 2019 will end up as a year with S&P 500 returns of more than 30% and no corporate earnings growth to speak of. That means

Consumer inflationary pressures grew at a healthy, but manageable rate in December 2019.

The core Consumer Price Index (CPI), which excludes food and energy, rose 2.3% year over year last month, around the fastest pace of the economic cycle. As shown in the LPL Chart of the Day, core CPI growth has been steady, thanks to firm U.S. demand, despite slowing producer price and wage growth.

Inflation concerns are back in the spotlight after the December 2019 jobs report showed year-over-year wage growth for nonsupervisory workers slowed to 3%, a 15-month low. However, today’s CPI data shows companies s