From the policy pivot in late 2018 to calm markets, to the cutting of interest rates in 2019 when unemployment was at a 50-year low, to the unprecedented extent of policy support conducted during the COVID shock, to maintaining aggressive easing post-COVID, despite signs of strong growth and high inflation, Powell has overseen a stretch of ultra-dovish policy actions.

August has been a cruel month for equity and bond investors. After a relatively bright and calm start to summer, with generally rising risk asset prices and low volatility, this month has been more challenging and tumultuous.

After a roaring rally from mid-March until late July, U.S. equity markets have entered a correction phase. So far, the correction has been shallow and healthy, not exhibiting signs of the bends, or a sharp correction after a powerful rally.

As we pass the halfway point of the second quarter U.S. equity earnings season, this week we are providing our assessment of the current earnings environment, evaluating the expectations for earnings in 2024, and examining if more fundamentally driven equity performance is possible, which we believe will be key if markets are to build on gains generated in the first half of the year.