Bloomberg Intelligence's 'Equity Market Minute' 1/27/2023

Gina Martin Adams discusses the significant impact of inflation on equity markets, particularly during the 1970s and 80s, and its relevance to current market conditions. She highlights the relationship between inflation peaks and S&P troughs, noting the necessity of continued inflation deceleration for stable market performance. The discussion also covers how inflation affects operating margins, especially for non-energy companies in the S&P 500, and the potential for improvement with disinflationary trends. The video concludes with a brief outlook on market conditions.

What was a significant effect of high inflation in the 1970s and 80s on the equity markets?

• It led to a bull market.

• It caused market stability.

• It was disruptive to market conditions.

• It had no impact on the markets.

How did the inflation peak in 2022 relate to the S&P index?

• It occurred after the S&P index peaked.

• It occurred just before the S&P index trough.

• It had no relation to the S&P index.

• It occurred simultaneously with the S&P index peak.

What is necessary for stocks to perform well according to the second section?

• Stable inflation rates

• Unpredictable inflation trends

• Continued inflation increase

• Continued deceleration in inflation

Which group of companies struggled with strong inflation in 2022?

• Healthcare companies

• Ex-energy companies in the S&P 500

• Tech companies

• Financial companies

What is the anticipated outcome for operating margins if inflation continues to decelerate?

• Margins will become unpredictable.

• Margins will stabilize.

• Margins will rise sharply.

• Margins will continue to fall.