Tech Earnings Are on Fire, Golub Says

• Semiconductor earnings are up more than 50% since January 1st, indicating strong corporate fundamentals.
• Valuations are lower across most of the market, suggesting that stocks are getting cheaper as earnings grow faster than prices.
• The economic backdrop is robust, with positive economic surprise data, strong jobs reports, and a declining probability of recession (down from 30% to 25%).
• The market's reaction to minor shifts in Fed rate cut expectations (a half-cut) is seen as an overreaction, as the economy does not require such support.

Jonathan Golub of Seaport Research Partners asserts that corporate earnings, especially in the semiconductor sector, are 'absolutely on fire,' with chip earnings up over 50% since January 1st. He argues that despite recent market pullbacks, valuations are lower almost everywhere, and the overall economic backdrop remains 'really healthy,' making profit-taking unwarranted.