Investment Review - November 2023
- The major U.S. stock indices fell in October. The Dow Jones Industrial Average declined 1.4%. The S&P 500 Index fell 2.2% and the Nasdaq Composite lost 2.8%.
- Third quarter earnings are expected to be 1.3% higher than a year earlier for members of the S&P 500 Index. This compares to a 2.8% decline in the second quarter. Energy stocks are expected to report a 34% earnings decline for the third quarter based on lower fuel prices versus last year. Ex-energy, earnings estimates have increased 6.4% and are supportive of current market valuations. Valuation has improved to 17.4x from the 2023 peak of near 20x in July. The 25-year average P/E is 16.7x.
- A deepening sell-off in the US bond market drove the 10-year US Treasury yield briefly above 5% during the month – the highest since 2007. Bond prices recovered somewhat during the last week of October with the 10-year yield closing just under 4.9%.
Key Investment Statistics
Sources: Bloomberg, LLC., FactSet, U.S. Department of Labor, Oppenheimer Research, Federal Reserve Bank of Boston, European Parliamentary Service, ADP National Employment Report, Business InsiderDisclosure: This commentary reflects the opinions of Welch & Forbes based on information that we believe to be reliable. It is intended for informational purposes only, and not to suggest any specific performance or results, nor should it be considered investment, financial, tax or other professional advice. It is not an offer or solicitation.
For more information, call 617-557-9800, or email info@welchforbes.com.