It was a relatively quiet economic news week. As a result, two events drove the market action. First was the
release of the FOMC Minutes from their January 30-31 meeting, wherein in it reaffirmed tightening was over
and inflation trends were good but, any rate cuts will require.......
Weekly Commentary
Monthly Commentary
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The obsession with Fed rate cuts is continuing. The week started with the release of March Retail Sales where
the “core” rate (ex-auto and gas) came in month over month at 1.00% versus 0.5% and year over year at 4.86%
versus 2.20% versus the prior month. When added to the renewed inflation......
Inflation and rate cut worries dominated the market action. The March CPI showed no improvement for the monthly inflation rate and a slight uptick in the year over year rate, which triggered a large market sell off on fears there would be no rate cuts from the Fed. Other inflation reports later in the week showed similar trends, although the absolute levels remained near or below the Fed’s 2% target. These provided some.......
Concerns over escalating geopolitical risk from the wars in the Middle East and Ukraine and their near-term impact on driving up commodity inflation, which is dampening hopes for a rate cut, led to the worst one day sell off on Thursday for the S&P 500 since February. Stocks recovered some of their losses on Friday from a strong March Jobs Report which suggested job gains were not driving .....
Market attention again focused on the Fed and when it might reduce interest rates. At Fed Chairman Powell’s
Wednesday press conference, there was enough “Fed Speak” for everyone to take from it whatever they would
like. The US stock market did just that, concluding that rate cuts later....
Renewed inflation concerns drove the action in financial markets. The February CPI came in at 0.4% versus 0.3% for the prior month and 3.2% versus 3.1% year over year; energy and shelter prices were the main drivers. Two days later, the February PPI came in at 0.6% versus 0.3% the prior month........
It was a relatively quiet economic news week. As a result, two events drove the market action. First was the
release of the FOMC Minutes from their January 30-31 meeting, wherein in it reaffirmed tightening was over
and inflation trends were good but, any rate cuts will require.......
Inflation was once again the center of attention. On Tuesday the January CPI Report disappointed financial
markets with essentially no further progress in the decline of the rate of inflation. That led to a 1.4% sell-off in
the S&P 500 that day. However, other inflation news later in the week helped markets recover........
In an interview on 60 Minutes last Sunday, Fed Chairman Powell reiterated lowered expectations for a rate cut
at the FOMC’s March meeting. That gave further rise to Treasury yields and the Dollar. However, the stock market reacted differently.....
Good news on inflation and the economy drove the S&P 500 to a new high. On the economy, Q4 2023 GDP registered an annualized growth rate at a strong 3.3%. The next day, the Fed’s preferred inflation measure, the PCE Price Index, reported year-over-year core inflation for December at 2.9% versus 3.2% the previous month. So, despite the ongoing contraction in manufacturing, the markets interpreted this as......
Monthly Commentary
It was another month of mixed economic news. Housing remained resilient with strength as new home construction and the services sector are still reporting modest growth. However, manufacturing is still reporting flat to contracting conditions. The labor market showed its first sign.....
Market action vacillated between a better than expected economy and disappointment that rate cuts might not be forthcoming as soon as expected. That eventually gave way to the resignation that the economy could hold up awaiting the eventual rate cuts. Further improvements in inflation underpinned confidence......
The financial markets started out the year shaking off the hangover from 2023’s Santa Claus rally. The blame was placed not on an over exuberance in late 2023 but, rather, fears that the Fed will not cut rates in 2024 and thereby cause.......
December continued the year end rally in financial markets. Interest rates drove the market action. At a speech on December 1st and again at the December 13th FOMC press conference, Chairman Powell said, in as many words as possible, that the Fed was done hiking rates. What really turbocharged the markets.....
The month saw a stunning rally in all financial assets, all driven by one factor – interest rates. The month began with signals from the Fed that it was done with any further rate hikes, which generated a strong rally. Two days later, a weak October Jobs Report accompanied by further moderation .....
September was rocked by a substantial rise in Treasury Bond yields. The 10 Year Treasury ended the month at 4.57% up from 4.09% on August 31 and 3.87% on December 30, 2022. The reasons are straight forward. The economy remains more resilient than expected. While manufacturing remains in contraction, the services sector is in solid growth which should continue through the year end. As a result, the jobs market continues .....
There has been much concern in society at large, and the financial markets in particular, about the escalation of
geopolitical tensions between China and the US. These tensions have centered primarily around the increasing
rhetoric and saber rattling over Taiwan’s statehood status. Chinese equities remain.....