Economic Update – Key Themes for 2024

The momentum in investment markets has persisted as we move further into 2024, prompting varied reactions among investors and market commentators. Notably, the US 4Q reporting season has exceeded expectations, with strong performances relative to forecasts. Expectations for S&P 500 EPS in 2023 have seen a notable uptick, while the outlook for 2024 remains cautiously optimistic. Although some analysts express scepticism, particularly regarding the absence of upgrades for 2024 EPS, the consensus forecasts project a 10.7% growth in EPS for 2024, a significant improvement compared to the 2% expected for 2023. This positive trajectory in US profits signals a potential shift in the global equity markets.

In Australia, the reporting season has commenced, with prominent companies such as James Hardie, JB HiFi, CSL, and BRG leading the charge in the second week, with more major players expected to follow suit.

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