Analysts Lower Earnings Estimates as Rate Hikes Slow Economy, But Quality Tech and Cheaper Sectors Offer Opportunities
• Analysts pulling back estimates, seeing full effect of rate hikes; economy and consumer spending slowing while labor costs rise • Market priced for perfection - pricing in 6 Fed rate cuts and 12% earnings growth • Analysts decreased Q4 earnings estimates by 6.8%, over 2x 10-year average • Quality tech stocks with solid balance sheets and earnings still attracting investors, but leaves market with narrow breadth • Opportunities in cheaper value sectors like financials and energy, which typically have solid earnings