Today's Scoop:

Hey friends, hope it was an excellent weekend.

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Here's what you need to know today...

1. High growth companies that over hired during the pandemic are cutting staff.

2. Economic data keeps pointing to an impending recession.

3. Corporations aren't reporting great year-end performance.

S&P 500: 4,019.811Mo: +5% | 1Yr: -9% | 5Yr: +40%

The market continued its positive momentum from Friday without any significant good news. Investors hope a clear economic slowdown and lower inflation will encourage policymakers to stop restricting the economy.

Layoff announcements are rising, particularly in tech and high-growth companies. Many who got a big boost from the pandemic ended up overhiring. Now, with sales slowing, they have to cut back costs.

Corporate financial updates haven't been good. We're only 11% through fourth-quarter financial reports, but so far, more than a third of companies have reported lower profits than expected. That's much higher than average, according to Factset.

Economic data points to recession. The Conference Board’s Leading Economic Index dropped for the tenth straight month in December into recession territory.

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• Abbott Labs is under criminal investigation for tainted baby formula

• Morgan Stanley cuts its CEO pay by 10%

• Google slashes human staff and ramps up AI

• Wayfair dials back its over-hiring

• Netflix subscriptions surge again

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Earnings Per Share (EPS)

Earnings Per Share (EPS) is one of the two main metrics you'll find in the news about a corporation's quarterly financial update. Earnings is another word for profit, and so is net income.

Earnings per share are the company's profit divided by the number of shares available. It's a standard way for an investor to evaluate whether the company is earning more or less profit this quarter than the investor expected.

Understanding how much the stock price is marked up over the company's profitability is also helpful. If one company's share price is 15x higher than its earnings per share, investors are more confident in its future than a company whose share price is 12x its EPS. That's its price-to-earnings (PE) multiple.