Focusing on what matters most

The weight of the world feels extra heavy these days.

The stock and crypto markets are dipping to February lows, back when we were just starting to process the Ukraine invasion. Since then, we’ve watched the yield curve briefly invert, inflation move even higher, and the Federal Reserve doggedly insists that it’ll raise rates at the cost of growth. Oh, and Elon Musk is buying Twitter.

It’s a lot to process. And some investors have understandably tapped out.

But in these trying times, we’re here to help you focus on what could matter most. Earnings and economic momentum are the anchors of the stock market, and we’ve seen a few bits of good news on both fronts. 

  • It looks like we’ve underestimated corporate America’s resilience this year. 76% of S&P 500 companies have beaten first-quarter earnings estimates so far and profit growth is tracking at about 7% year over year, according to Bloomberg. Not bad for a quarter when the biggest worries were inflation and growth.
  • Leading economic indicators like manufacturing and durable goods indicate that growth is still strong. Plus, there are signs that inflation may finally be peaking.
  • The Fed may be more in control than you think. This Fed regime has also watched data closely, and it’s prided itself on flexibility – even if that stance isn’t so obvious at the moment.
  • This is a battle-tested market. Stocks and crypto have absorbed a lot of bad news this year, yet both have stayed relatively resilient. Now that markets have baked in close to a worst-case scenario, they could perk up at any “less bad” news down the road.

It’s been a rough year, and it’s easy to fall into a spiral of fear and doom scrolling. But as you navigate this tricky environment, don’t forget the foundation of the market. And if you’re a long-term investor who’s able to look past the headlines, you may find some opportunity at these prices.

Sometimes, a 10% selloff can be more like a 10% sale if you’re willing to wait.