It’s no secret that the S&P 500 has dominated in the past ten years, rising over 375% between 3/9/09 and 12/31/19 and cruising to another all time high this week on news of strong earnings, halved Chinese tariffs, and a potential coronavirus vaccine.

Despite ongoing coronavirus fears (or perhaps because they’ve finally been offered some relief—thanks Gilead Sciences!), stocks rebounded yesterday, leading the S&P 500® Index to its best day in nearly six months. 70%+ of the S&P 500 sectors are at record valuations—a higher percentage even than during the tech bubble—but a look at the index’s five largest companies tells a different story on value.

Friday was a dark day in the markets that saw the Dow and the S&P wipe out their gains for the year. Utilities have surged as investors have begun seeking safety and regional PMI’s look to have turned a corner, though Chicago is lagging the pack and continues in contraction.

While the eastern U.S. and even Germany look to have (finally) turned a corner on manufacturing, China’s manufacturing PMI remains firmly on the line between growth and contraction. If a strong wind wouldn’t be enough to blow them one way or the other, the coronavirus—yesterday dubbed a “global health emergency” by the WHO—just might be.

Much was made of 2019’s yield curve inversions and the signal’s penchant for predicting recessions, but a relatively strong Q3 earnings season and continued dominance from the S&P 500 helped offset a lot of investor anxiety. However, the emergence and spread of the coronavirus has sparked a flight to safety, sending yields sharply lower and causing the yield curve to revisit its 2019 patterns.

Equities and Treasuries are sending different signals these days, with treasury yields painting a grimmer picture than the ever-surging S&P 500. The often synchronous measures started to diverge in early 2019 and the gap between them has continued to grow since. Which do you think is more indicative of our current economic state?

While we’ve seen some promising signs on economic activity (and even manufacturing, finally) out of New York and Philadelphia recently, the news hasn’t quite reached Chicago yet and the regional National Activity Index print fell both short of expectations and into contraction. Agricultural readings have us breathing a sigh of relief on behalf of the long-suffering American Farmer, and we’re keeping our fingers crossed the feeling won’t be short lived.

As we settle into the second week of earnings season, let’s take a look at what the analysts see coming in the next year. 4Q19 forecasts are predicting earnings will be down year-over-year, but analysts seem to see nothing but blue skies ahead in 2020 and project four straight quarters of YoY earnings growth. And while we’re currently in one of the longest periods of market calm on record, could this be the calm before the storm?

The S&P 500 sailed through the 3,300 mark for the first time yesterday to clinch yet another record, thanks in large part to solid December retail numbers, a strong start to earnings season, and tech stocks (congratulations Alphabet!). But similarly outsized performance back in 2018 was followed quickly by a significant correction—should we brace for history to repeat itself?

The S&P 500 hit 22 new all-time closing highs in 2019 and just continued its record setting into 2020; the top five public U.S. companies now hold a record 18% of the benchmark’s total market cap—higher even than during the tech bubble—but net income is failing to keep up. The dawn of a new decade often brings nostalgia, but do we really want to be revisiting the late 90’s (with the dot-com bust and ’00-’02 recession hot on its heels)?