What’s going on in the markets?
Michael Knox
Morgans
"What's going on?" is a question I’ve been asked more than once in recent weeks. My view is that the basic causes of the big swings in the market relate to disappointments in US earnings. The variation of the market has not actually been driven by China or by Brexit or even that much by the Saudis. The market has actually been driven by good old-fashioned fundamentals. The market has been driven by variation in earnings. We are all going to have an interesting ride as the market discovers the level of earnings that the economy is going to deliver. In the chart below we see the path of operating earnings per share for the S&P500 since the beginning of 2014. The blue line on the chart shows the actual level of earnings per quarter, up until the final quarter of 2015. For 2016, we show the consensus earnings forecast as the red line. (VIEW LINK)
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Michael was an Australian Trade Commissioner serving in Saudi Arabia and Indonesia. He joined Morgans (now Morgans Financial Limited) in Sydney in 1988. He was Chief Institutional Options Dealer until moving to Brisbane in 1990 as Economist and Strategist. He joined the Board of Morgan Stockbroking in 1996. He became Director of Strategy and Chief Economist in 1998. Michael has served on many Queensland Government advisory committees. He was Chairman of the Queensland Food Industry Strategy Committee in 1992, a Member of the Consultative Committee of the Ipswich Development Board in 1993, a Member of the Queensland Tourism Strategy Committee in 1994 and a Member of the Ministerial Advisory Committee on Economic Development in 1997. From 2003 to 2012, he was Chairman of the Advisory Committee of School of Economics and Finance at the Queensland University of Technology. He has been a Governor of the American Chamber of Commerce from 1997 to 2007. In 2008, Michael joined the Board of The City of Brisbane Investment Corporation Pty Ltd. Michael was the President of the Economic Society of Australia (Qld) Inc from 2009 to 2013. He is now the immediate post President.
Michael Knox
Director of Strategy and Chief Economist
Morgans
Michael was an Australian Trade Commissioner serving in Saudi Arabia and Indonesia. He joined Morgans (now Morgans Financial Limited) in Sydney in 1988. He was Chief Institutional Options Dealer until moving to Brisbane in 1990 as Economist and...
Expertise
No areas of expertise
Michael Knox
Director of Strategy and Chief Economist
Morgans
Michael was an Australian Trade Commissioner serving in Saudi Arabia and Indonesia. He joined Morgans (now Morgans Financial Limited) in Sydney in 1988. He was Chief Institutional Options Dealer until moving to Brisbane in 1990 as Economist and...
Expertise
No areas of expertise
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