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Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.

In today’s Chart of The Day I’m showing you a slide (76 in our Q2 Macro deck) I’ve been chatting with clients about for the last week:

A) PRE VIRUS, profitability was already deteriorating (like it always does at this stage of The Cycle)
B) Alongside Global #Quad4 Slowing since the beginning of 2018, US Labor Costs Rising was classic late cycle

That’s why:

C) PRE VIRUS, 37% of the companies in the Russell 2000 had NEGATIVE pre-tax income … and
D) PRE VIRUS, 27% of companies with market caps > $10B had NEGATIVE year-over-year EPS growth

“No one” (ex the legally blind) could have seen The Cycle coming, eh?

CHART OF THE DAY: Profitability Was Already Deteriorating  - 76