A handful of large US technology companies have driven the market higher this year while the return for the average company is relatively flat.
Growth of the US economy and corporate earnings appears to have flat-lined, and investors are now seeking to
determine the future direction of both.
We do not anticipate a significant US economic / earnings contraction, driven largely by the robust labor market,
but stress in the US banking system and resulting tighter lending conditions seem almost certain to be a
meaningful headwind for the rest of 2023.
The debt ceiling may be an additional source of volatility, but history has shown a propensity for this risk to be
resolved.