Later today, the Fed will have cut its policy rate. Historically, this correlates with how both the economy and stocks perform – down. Later today, the Fed will have eased – probably by 25 basis points, to a range of … Continued
Inventory burn likely weighs on growth in future quarters, casting doubt on the sell-side’s expectations for a pick-up in earnings growth momentum as the year progresses. This is a medium- to long-term issue. Near term, recapturing of 1600 on the … Continued
The 1Q19 earnings season is upon us. Expected growth has softened. The bar is low. The sell-side expects growth to pick up speed in the second half. Operating earnings of S&P 500 companies are expected to grow 9.1 percent this … Continued
Stocks rallied for three months in defiance of deteriorating macro data. By essentially putting an end to the tightening cycle, the Fed is acknowledging this. Stocks could be the next. What just happened? Many are probably asking that question after … Continued
The Fed meets this week. It already shifted its bias from hawkish to dovish, helping stocks. With the economy softening, in due course the Fed may once again deploy balance sheet as a tool, which will initially help stocks, but … Continued
Bonds and stocks diverged for a couple of months before beginning to move hand in hand this month. The former is not buying the enthusiasm shown by the latter. The 10-year T-yield currently sits at decade-old support. A breakdown will … Continued
The sharp decline in US stocks last October-December forced the Fed to do a 360 as relates to its campaign to tighten monetary policy. The dovish shift apparently wants to unleash animal spirits. Investors have obliged – thus far. Will … Continued
Thursday’s retail sales data likely poured more gasoline into the recession-fear fire. The cycle is getting long in the tooth. Risks are rising. The expansion has lasted for nearly a decade. Contraction is just a matter of when not if. … Continued
Post-Powell’s supposed dovish switch last week, equity bulls spent lots of energy to rally the S&P 500 within less than two points of the 200-day. If the trade-tariff truce the US and China reached over the weekend in Argentina is … Continued
If early this year the 10-year T-yield vouched for the strength of the US economy as it broke out of multi-year/decade resistance, what is it trying to tell us now that it seems to have hit the wall and is … Continued