Headlines have been dominated by the better-than expected October CPI report, but this improvement in inflation will likely be overshadowed by a deteriorating growth outlook in the coming months.

As Americans head to the grocery store this week to stock up on ingredients, they may be frustrated to discover that the cost of a Thanksgiving dinner is a whopping 20% higher than last year…

After peaking at 9.1% y/y in June, inflation has slowly been receding.

The October Jobs report saw a stronger-than-expected gain of 261,000 non-farm payroll jobs.

With over half of the market reporting, our current estimate for 3Q22 S&P 500 operating earnings per share (EPS) is $52.42. If realized, this would represent y/y growth of 0.8% and q/q growth of 11.9%.

As the U.S. Federal Reserve continues to aggressively tighten monetary policy, the average 30-year mortgage rate has skyrocketed to a two-decade high of 6.94%.

Following a string of upside surprises, the September CPI report dashed hopes for a deceleration in inflation.

OPEC+ announced its plan to reduce oil output by 2M barrels/day starting in November.

The third quarter of 2022 saw financial assets continue their year-to-date decline, as positive stock bond correlations and a pullback in commodity prices delivered negative returns across all asset classes except cash.

As of Friday’s close, large cap equities are down 21.6% YTD. This is more than explained by declining P/E multiples, as earnings expectations themselves have proven relatively robust, despite increasing recession concerns.