The stock market has been on an incredible tear this year, but critics argue that the gains have come from increase multiples, rather than improved earnings, and that the gains therefore are not sustainable.
But stronger earnings may abe on the way.
In his latest strategy note, JPMorgan's Tom Lee passes along this chart created by his colleague Michael Cembalest, which compares corporate earnings growth against global PMI readings. The earnings growth line ins on a 4 month lag. Given the recent spike up in global PMI readings, an earnings acceleration should be on the way.
