Published July 2, 2021
Last week we brought you a global outlook from Schwab. This week, we bring a mid-year outlook published by Invesco, the company responsible for the Nasdaq 100 ETF (symbol: QQQ) that our models focus on. Needless to say, Invesco is very positive on the outlook. (more…)
Published June 25, 2021
With mid-year outlooks for the markets and economy being published this month, we take a look at what the retail investing behemoth, Schwab, has to say about the remainder of 2021. Their article below focuses on the global economy. (more…)
Published June 18, 2021
This year’s stock market has been all about rotation with money moving into value stocks and out of growth stocks. The narrative has been that rising inflation would push up interest rates. The hike in rates in turn raises the denominator of the classic stock price valuation (e.g. earnings/interest rates) which devalues high-flying growth stocks. The beneficiaries of this narrative have been cyclical sectors like materials, industrials, and energy. This week that narrative took a beating. (more…)
Published June 11, 2021
This week’s inflation report generated plenty of alarming headlines. As the chart below shows, inflation hit its highest point since, well, the end of the last economic crisis. Which points to one of the reasons why the alarming headlines are misleading. (more…)
Published June 4, 2021
While there remain many places still struggling with Covid-19 and its myriad effects, the broad U.S. economy is, less and less, one of those places. This week, the Federal Reserve made clear they are ready to begin backing out of the unprecedented market supports they put in place a year ago. It will be a good while before the Fed takes any action on interest rates. For now, they are beginning to sell off the assets accumulated during the height of pandemic uncertainty. Those assets are the corporate bonds and ETFs purchased by the Central Bank last summer to shore up wavering market confidence. (more…)
Published May 28, 2021
This week we catch up with the folks at Schwab who provide a wide-ranging analysis on markets and the economy. Here is their latest work:
“As we move into the summer, the pace of economic growth remains robust, notwithstanding a weak April jobs report. Gross domestic product (GDP), although a lagging indicator, grew at an annualized quarter over quarter rate of 6.4% in the first quarter. That undercut economists’ consensus estimates slightly, but much of the drag was due to inventories—consumption was quite strong, growing at a 10.7% rate. (more…)
Published May 21, 2021
Taking a step back this week to consider the broad market and the substantial changes that have been going on under the surface. At surface level, the broad market S&P 500 remains close to its all-time highs while our favored Nasdaq 100 index, heavy with tech and consumer stocks, has been choppy over the past four months.
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Published May 14, 2021
The stock market continues to hold on through intermittent bouts of selling. Corporate earnings have been record-setting in their growth from year-ago levels, severely depressed though they were. Despite outrageously good earnings for the top growth stocks in the Nasdaq, investors continue to shift money to cyclical value sectors like energy, finance, materials. The lackluster response to the hotshot earnings has led to some heavy down days in the market recently. (more…)
Published May 7, 2021
The predominant narrative right now in the markets is that inflation will rise as economies reopen and recover. While it’s easy to find inflationary movements in the price of some goods like lumber, houses and food, the primary driver of overall inflation comes from rising wages. Pre-pandemic, wages had been stagnant for years. (more…)
Published April 30, 2021
Below is a smattering of data points on the state of the reopening economy. These tidbits come from the always informative weekly roundup provided by Blaine Rollins at Hamilton Lane. We hope you find them as informative as we do. (more…)