U.S. economic growth lately has been squarely on consumers’ shoulders. Consumer spending likely added about 2.8% to second quarter gross domestic product (GDP), according to the Federal Reserve (Fed) Bank of Atlanta’s GDP forecasting model. At that rate, the consumer’s contribution to GDP would be the highest for any quarter since the end of 2014.

Still, when the GDP report is released July 26, we may see that overall growth last quarter was 1.6%, the slowest since the beginning of 2016. Consumer activity has meaningfully lifted growth, but projections show other parts of the economy withered. The makeup of grow

Second quarter earnings season gets rolling this week. Consensus estimates are calling for a modest year-over-year decline in S&P 500 Index earnings amid the downshift in U.S. and international economic growth, tariffs, and ongoing trade tensions. Quarterly earnings almost always beat quarter-end consensus estimates — this quarter will likely be the 41st in a row to do that — so we expect a slight year-over-year gain that would continue the stretch of consecutive quarterly earnings gains since the 2016 earnings recession [Figure 1]. Nearly 60 companies will report this week (July 15 – 19). Here we preview second-quarter

Financial markets are focused on U.S. monetary policy, but the Federal Reserve (Fed) is only part of the story. Central banks around the world are embarking on a marked policy shift as trade tensions pressure the global economy and government becomes more intertwined with policy decisions. Global monetary policy is still historically loose, but policymakers abroad are searching for alternatives to jump-start growth, with no trade resolution in sight [Figure 1].

Fed Poised to Cut

The Fed’s policy shifts this year have been the most watched, as the U.S. central bank dictates monetary policy for the world&rs

Even after such a strong first half of this year, we think stocks may have more left in the tank. The S&P 500 Index gained 17.4% during the first half of 2019 — an excellent performance — even though a decent chunk of those gains reversed the 2018 fourth quarter losses. Putting that six-month performance into perspective, it was the best start to a year for the stock market since 1997, and its tenth-best start since 1950. This week we recap the first half and analyze prior strong starts to see what we might expect in the second half of 2019.

First-Half Recap

The main drivers of the strong first half were the