Stocks and bonds have had a strong start to the year due to resilient economic data, a bounce back in profit marginsand a moderation in the market’s expectations for interest rates. That being said, while stocks and bonds haveimproved from their lows of 2022, commodities finished 1H23 down due to cooling energy prices and weakeningglobal manufacturing demand.… Read More
Last week, investors parsed a slew of forward-looking data as they work to gauge the probability of a near-term recession. The Conference Board Leading Economic Index (LEI), a bellwether of economic health, took center stage, andrevealed a continued divergence between the economy and financial markets.… Read More
Last week, the Federal Reserve opted to keep the federal funds rate unchanged but hawkish messaging left the dooropen for further tightening in the coming months. In the Fed’s defense, economic growth has so far been resilient,suggesting the economy may be able to weather tighter conditions for longer.… Read More
On Wednesday, the Fed should provide more clarity on the trajectory of rates after vacillation in market expectationsover the past month, which we illustrate in this week’s chart. As of Friday, the federal funds futures market was pricing ina 28% probability of a hike in June and a 54% chance of a skip in June followed by a hike in July.… Read More
Last week, investors received a large bundle of data related to the jobs market. There is some indication of futureweakness, but overall the jobs data mosaic points to normalization at a gradual pace. The May employment reportshowed a net creation of 339,000 jobs, above expectations and an uptick compared to April’s 264,000.… Read More
10-year Treasury yields have climbed by roughly 38bps to 3.80% in May, their highest level since SVB collapsed,reflecting the market’s improved optimism for economic growth and shifting expectations for monetary policy.
Download Full-Size PDF:
Click Here
weekly_market_recap-05-29-2023
Despite slower economic growth, 1Q23 S&P 500 earnings have surprised to the upside, as economic momentum atthe beginning of the year supported an expansion in profit margins. With over 90% of the S&P 500’smarket cap havingreported, profit margins currently stand at 11.8%, a level of profitability that had only been eclipsed once in the pre pandemic period.… Read More
A million dollars used to be the ultimate target for retirement portfolios. Retiring as a millionaire brought status and confidence that you could live comfortably during your golden years.
If you retired with $1 million in 1970, you probably wouldn’t have to worry about your nest egg running out, even with a lavish lifestyle.… Read More
The clock is ticking on US debt ceiling negotiations. Treasury Secretary Yellen informed Congress that cash balances are estimated to run out by early June, the so called X-date 1 With the deadline fast approaching, markets are sending signals about investor concerns.… Read More
Following the Federal Reserve’s (Fed’s) decision to raise the federal funds rate to a range of 5.00%-5.25%, investorsscoured April’s CPI report and the 1Q Senior Loan Officer Survey in an attempt to get a sense of the Fed’s next steps.
Download Full-Size PDF:
Click Here
weekly_market_recap-05-15-2023