FEATURED MARKET DATA
Sentiment Weakens in February
U.S. Economic data reported in February generally weakened as shown by the Citigroup Economic Surprise Index turning negative during the month. At the same time, consumer confidence softened, led by a decrease in the Expectations component of the index.
by Laura Fox FEATURED MARKET DATA
Stocks Turn Higher in January
U.S. equities ended higher in January following December declines as markets expressed relief from no immediate actions on tariffs. However, news on possible Mexico, Canada and China tariffs was quickly developing near month-end and in the first days of February.
by Laura Fox FEATURED MARKET DATA
Steepening Yield Curve
The Federal Reserve cut rates by 0.25% as expected in December to a range of 4.25-4.50%, yet longer-term yields rose for the month. The shift up in longer term yields was due in part to a hawkish tone from the Federal Reserve.
by Laura Fox FEATURED MARKET DATA
Bond Market Volatility
The Federal Reserve cut rates by 0.25% as expected on November 7th, yet 2-year Treasury yields began the month with a continuation of rising yields. Higher yields reflected the market’s belief that the Fed would cut rates less than previously anticipated as well as U.S. Fiscal worries.
by Laura Fox FEATURED MARKET DATA
Election Unease?
While the Fed did not meet in October, Treasury yields rose across the curve. The 5-year Treasury rose 60 basis points in October to close at 4.16% as market-based inflation expectations also increased.
by Laura Fox FEATURED MARKET DATA
Strong Bond Returns
Third quarter bond returns were the strongest since the 4th quarter of 2023. Bond yields declined during the quarter as Fedspeak leaned dovish with the Fed refocusing attention on risks to the labor market. In September, the Fed completed its pivot with a more aggressive than expected 50 basis point rate cut.
by Laura Fox FEATURED MARKET DATA
Fed’s Attention Shifts to Employment
Lower than expected growth in July payrolls (114K) and an increase in the unemployment rate to 4.3% raised market concerns in early August that the Fed might be behind on cutting interest rates. During August, Fed speak increasingly focused on employment and provided indications the Fed plans to cut rates in its September meeting.
by Laura Fox FEATURED MARKET DATA
Strong Start to Second Quarter Earnings Season
With over half of S&P 500 companies reporting second quarter earnings by the end of July, the blended year-over-year earnings growth rate was 10.2%. This is ahead of the 8.9% expected growth rate at the end of June. More than 78% of companies reporting earnings have beat estimates and these companies have, on average, beat earnings forecasts by approximately 4%.
by Laura Fox FEATURED MARKET DATA
Soft Landing Narrative Returns
While the first quarter brought stronger than expected inflation and growth, economic data cooled in the second quarter. Core month-over-month CPI rose a faster than expected 0.4% in each of the first three months of the year but slowed to 0.3% and 0.2% in April and May, respectively. Core PCE, the Fed’s preferred measure of inflation, slowed even more to 0.1% in May.
by Laura Fox FEATURED MARKET DATA
Corporate Earnings Support Markets
With the first quarter corporate earnings season complete, S&P 500 companies reported a blended growth rate of 5.9%. The level was well ahead of market expectations and the strongest since the first quarter of 2022. The breadth of earnings beats was also strong, with the percentage of companies exceeding earnings growth expectations above average.
by Laura Fox 