The Wall Street Journal

How to Think About the Stock Market When Earnings Guidance Becomes Meaningless

Trade war puts companies’ profit outlooks on shaky ground, and with them the S&P 500’s valuation

Some Wall Streeters are factoring in a chance of a recession or at least a severe slowdown.
Some Wall Streeters are factoring in a chance of a recession or at least a severe slowdown. Photo: TIMOTHY A. CLARY/AFP/GETTY IMAGES

Economist Burton Malkiel might have called the stock market “a random walk,” but investors could at least use earnings guidance by companies as road signs. Now they are largely walking blind.

Last week, BMW reiterated its 2025 financial guidance from mid-March, but included the assumption that the Trump administration would roll back some of the more-recent tariff increases starting in July.

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