Recent economic data have continued to underscore the strength of the U.S. economy, and we anticipate GDP grewby 2.2% annualized during the first quarter. While this would be a deceleration relative to last quarter, above trend growthshould help prevent a meaningful slowdown in profit growth.… Read More
With Tax Day on April 15, it’s a good time to explore the relationship between the stock market and taxes and particularly how big capital gains tax payments may impact the stock market. This week’s chart shows an interesting trend: capital gains tax revenues tend to spike in fiscal years when the market undergoes significant sell-offs.… Read More
Last week, gold prices broke above $2,300 per ounce for the first time ever. Gold prices have been climbing for anumber of reasons, among which may be more hope for a soft landing and upcoming rate cuts in the U.S. This isbecause the opportunity cost of investing in gold, which is not an income-producing asset, decreases when interestrates fall.… Read More
In 2023, stocks and bonds both rallied. The first quarter of 2024, however, saw stocks reaching new heights, whilebonds experienced a modest downturn, as the market scaled back its rate cut expectations following surprisinglystrong economic data.
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weekly_market_recap-04-01-2024
U.S. 10-year Treasury yields have increased 34 basis points year-to-date and have remained above 4% since earlyFebruary. Yet over the same period, stocks have rallied 10%. At first glance, this dynamic may seem counterintuitive,because high and rising interest rates are typically associated with weaker equity market performance.… Read More
After the U.S. economy’s impressive 4% annualized growth in the second half of 2023, investors are searching for cluesas to whether this strong momentum will persist into 2024. For much of this quarter, the closely watched Atlanta FedGDPNow model has forecasted growth of at or above 3%.… Read More
The U.S. economy has seen a significant normalization in labor demand since the pandemic. Last week’s JOLTSreport showed 8.9M job openings in January 2024, a 27% fall from the peak of 12.2M openings in March 2022. With theeconomy expected to soften further this year, labor demand in most sectors will continue to moderate.… Read More
Given high short-term yields, many investors seeking income have recently piled into cash. Others, however, havebeen attracted to high yield (HY) bonds, given yields of close to 8% in a falling inflation, steady growth environment.
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weekly_market_recap-03-04-2024
Market expectations for Fed policy have swung dramatically over the past few months, from the higher-for-longer narrative to expectations of aggressive policy easing. With stronger-than-expected jobs and growth data this year and inflation still mild, investors have had to reassess their outlook for policy rates.… Read More
Last week’s January CPI report came in above expectations, with headline CPI rising 0.3% m/m and 3.1% y/y. Shelterprices, which increased 0.6% in January, accounted for over 2/3 of the monthly increase in headline CPI.
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weekly_market_recap-02-19-2024
Recent economic data have continued to underscore the strength of the U.S. economy, and we anticipate GDP grewby 2.2% annualized during the first quarter. While this would be a deceleration relative to last quarter, above trend growthshould help prevent a meaningful slowdown in profit growth.… Read More