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BCA report “Marginally Better Or Worse?” with a chart assessing macro and market signals for US equities.

Consensus expects a soft landing. However, it is an inherently unstable momentum state, which is followed by either a recession or economic overheating. The post-soft-landing outcome will depend on the key drivers of profit margins. 

Operating margins have been in a downdraft for nearly two years but now consensus is penciling in margin expansion in 2024 – we remain skeptical.