Published January 28, 2022
This week we are reviewing some interesting data from a recent presentation made by CFRA. The three charts tell a possible story for how this year will play out. First, after a strong year in the market in 2021, we have seen stocks hit a wall, tumbling hard throughout January. This selloff following a strong period is common, at least in the short-term. (more…)
Published October 29, 2021
There were some unusual moves in the markets this week. Some of those movements are attributed to the taxable year-end for mutual funds, which occurs at the end of October. That year-end leads to selling of some positions to capture gains and losses for the tax year. As a result, it is possibly too early to draw any firm conclusions from these moves. (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 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…)