16 04, 2019

Weekly Market Commentary -Investors took an intermission

2019-04-16T17:17:26+05:00April 16th, 2019|Weekly Market Commentary|

The Markets Investors took an intermission. The curtain appeared to close on the first act of 2019 last week – and what an impressive act it was. The Standard & Poor’s 500 Index delivered some dramatic returns and is less than 1 percent away from a new all-time high. Despite relatively few shares changing hands, major U.S. indices eked out gains. Ben Levisohn of Barron’s explained: “Trading volume was tepid at best. This past Monday, fewer shares changed hands than on any day since December 24 – when the market closed early for Christmas. Tuesday’s volume was lower than [...]

8 04, 2019

Weekly Market Commentary -2019 brought a welcome reversal

2019-04-08T22:18:05+05:00April 8th, 2019|Weekly Market Commentary|

The Markets The first quarter of 2019 brought a welcome reversal. Last year, Barron’s published a group of market strategists’ expectations for 2019 performance. The article came out in mid-December, before the steep year-end stock market decline. At that time, all of the strategists agreed: The S&P 500 Index would move higher during 2019. Their expectations appeared to be wildly optimistic when the Index lost 3.5 percent during the last two weeks of 2018, and finished the year down 6.2 percent. Overall, at the end of 2018, strategists expected the Index to reach 2,975 by year-end 2019. Despite starting [...]

2 04, 2019

Weekly Market Commentary – “Fascinatingly counterintuitive…”

2019-04-02T01:04:19+05:00April 2nd, 2019|Weekly Market Commentary|

The Markets “Fascinatingly counterintuitive…” That’s how Michael Arone, an investment strategist, described the U.S. market environment to Avi Salzman of Barron’s: “‘Stocks are rallying, but bond yields are reflecting much lower growth.’ Stocks rose during the quarter because the Fed backed away from raising interest rates, and investors grew more confident that the U.S. and China would sign a trade deal, Arone said. The market was also rebounding from a very rough fourth quarter – ‘conditions at the end of the year were wildly oversold,’ he noted.” Through the end of last week, the Standard & Poor’s 500 Index [...]

25 03, 2019

Weekly Market Commentary -Wonder what the Federal Reserve’s 40-yard dash time is?

2019-03-25T22:16:38+05:00March 25th, 2019|Weekly Market Commentary|

The Markets Wonder what the Federal Reserve’s 40-yard dash time is? On Wednesday, the Fed juked like an NFL running back and left investors wondering whether they should buy or sell. Heather Long of The Washington Post reported the U.S. central bank: Lowered its 2019 estimate for U.S. economic growth to 2.1 percent Announced its intention not to raise rates in 2019 Indicated it will stop shrinking its balance sheet in September Fed Chair Jerome Powell explained, “My colleagues and I have one overarching goal: to sustain the economic expansion with a strong job market and stable prices for [...]

19 03, 2019

Weekly Market Commentary – Why are U.S. stock and bond markets telling different stories?

2019-03-19T02:01:36+05:00March 19th, 2019|Weekly Market Commentary|

The Markets Stock and bond markets rallied. Last week, major U.S. stock indices finished higher for the 10th time in 12 weeks. Bond markets moved higher, too, with the yield on 10-year Treasuries dropping just below 2.6 percent, reported Randall Forsyth of Barron’s. Yields on 10-year Treasuries haven’t been this low since January 2018. The simultaneous rallies are curious because improving share prices are often an indication of a strong or strengthening economy. Improving bond prices tend to be a sign of weakening economic growth, reported Michael Santoli of CNBC. Why are U.S. stock and bond markets telling different [...]

11 03, 2019

Weekly Market Commentary – Markets were rattled last week

2019-03-11T22:24:51+05:00March 11th, 2019|Weekly Market Commentary|

The Markets Markets were rattled last week. The market hates surprises, especially when the surprise comes from a central bank. Last week, the European Central Bank (ECB) unexpectedly reversed course and took a more accommodative stance on monetary policy in an effort to encourage stronger European economic growth. Tom Fairless of Barron’s explained: “Officials are seeking to shore up an economy that has been rattled by shocks ranging from a slowdown in China to mass protests in France and bottlenecks in Germany’s crucial auto industry. They are threading a careful path between providing sufficient support for the region’s softening [...]

5 03, 2019

Weekly Market Commentary – Is it a soft landing?

2019-03-05T02:48:36+05:00March 5th, 2019|Weekly Market Commentary|

The Markets Is it a soft landing? Economists use aviation metaphors to describe the results of central banks’ efforts to manage rapidly growing economies. If the Federal Reserve lifts rates enough to prevent the economy from overheating without jolting it into recession, then it has engineered a soft landing, according to Investopedia. (Rate increases that drop a country into recession are hard landings.) Ben Levisohn of Barron’s thinks recent Fed actions may have produced the second soft landing in the history of the United States: “…the Federal Reserve might have engineered a soft landing for the U.S. economy…When Chairman [...]

26 02, 2019

Weekly Market Commentary-Investors pleased with the Federal Reserve

2019-02-26T02:03:54+05:00February 26th, 2019|Weekly Market Commentary|

The Markets Investors were pleased with the Federal Reserve’s (Fed) new approach to its balance sheet. The Fed delivered its semi-annual Monetary Policy Report to Congress last week. The report recapped the events of late 2018 and reiterated the Fed’s intention to “…be patient as it determines what future adjustments to the federal funds rate may be appropriate to support the Committee's congressionally mandated objectives of maximum employment and price stability.” In other words, rate hikes are on hold for now. The Fed also addressed issues related to its balance sheet, which grew from $900 billion at the end [...]

20 02, 2019

Weekly Market Commentary – Why did the stock market do that?

2019-02-20T00:15:04+05:00February 20th, 2019|Weekly Market Commentary|

The Markets Why did the stock market do that? The great mystery of stock markets reared its head last week. With no clear driver, the Dow Jones Industrial Average gained more than 3 percent, while the Nasdaq Composite and Standard & Poor’s (S&P) 500 Index moved higher by about 2.5 percent. It was a puzzler. Ben Levisohn of Barron’s explained: “Given those gains, we’d expect a heaping helping of good news, but not much was forthcoming. Earnings reports from [two large multinational companies] left investors wanting. And economic data were either bad or terrible in the United States – [...]

12 02, 2019

WEEKLY MARKET COMMENTARY-The Intersection of Economics and Valentine’s Day

2019-02-12T17:55:45+05:00February 12th, 2019|Weekly Market Commentary|

The Markets Central banks take a turn. At its first policy meeting of 2019, the U.S. Federal Reserve changed direction. After four rate increases in 2018, Chair Jerome Powell announced interest rates were on hold. Last week, banks in the United Kingdom, Australia, and India followed suit by either reducing rates or cautioning rate reductions were likely, reported Sam Fleming and Jamie Smyth of Financial Times. The dovish tone of central banks owes much to slowing global growth. January’s International Monetary Fund World Economic Outlook lowered global growth estimates for 2019 and 2020. Changing expectations were fueled both by [...]