FEATURED MARKET DATA
Fed Higher for Longer
In a speech in Jackson Hole, Wyoming on August 26, Fed Chair Jerome Powell emphasized the importance of reducing inflation. He said the Fed would continue raising rates and hold them higher until it is confident inflation is under control. This pushed up market expectations for where the Fed Funds rate will be at the end of 2022, 2023 and 2024.
by Laura Fox FEATURED MARKET DATA
Soft-ish Landing?
Markets turned generally more optimistic in July as the S&P 500 reported its strongest monthly returns since 2020, and growth meaningfully outperformed value. In bond markets, credit spreads declined for investment grade companies. The lower option adjusted spread (OAS) shows investors saw less credit risk for investment grade companies in July.
by Matt Orseske FEATURED MARKET DATA
Fighting Inflation
The Federal Reserve further expanded efforts to reduce inflation in June through a 75 basis point rate hike and hawkish Fed speak. Federal Reserve Chairman Jerome Powell was clear during Congressional testimony that the Fed is committed to price stability.
by Laura Fox FEATURED MARKET DATA
Past Peak Inflation?
Headline CPI declined to 8.3% in April from 8.5% in March as energy prices eased. This helped fuel expectations that inflation has peaked. Inflation breakevens, a forward-looking measure of inflation, have mostly declined since peaking in March.
by Laura Fox FEATURED MARKET DATA
GDP and the Fed
While the 1.4% decline in U.S. Real Gross Domestic Product (GDP) for the first quarter was a sharp reversal in growth trend, the underlying components display a much stronger picture.
by Laura Fox FEATURED MARKET DATA
Yield Curve Signals
The yield on 10-year Treasuries briefly dipped below 2-year Treasuries on Tuesday, March 29. When this inversion of the yield curve occurs for a sustained period of time, a recession has consistently followed in the next two years.
by Laura Fox FEATURED MARKET DATA
War, Inflation and the Fed
Consumer Price Inflation reached a 40-year high in January of 7.5%. Inflationary pressures increased in February as commodity prices such as oil, wheat, corn and metals rose on rising geopolitical risks, including the Russian invasion of Ukraine.
by Laura Fox FEATURED MARKET DATA
Economic Growth, Market Volatility
Economic data in January was largely in line with PMA’s forecast and market performance reflected our assessment that volatility may be high this year. Our base forecast was for strong economic growth and persistent inflation in 2022.
by Laura Fox FEATURED MARKET DATA
Corporate Earnings Drive Strong Returns
The S&P 500 rose 27% in 2021, marking a third consecutive year of double-digit gains. Price gains were supported by strong earnings growth for the year and continued healthy profit forecasts. The S&P 500 index’s valuation, measured by the price / earnings ratio, finished the year somewhat lower.
by Laura Fox FEATURED MARKET DATA
Stocks Down as Volatility Rose
Volatility trended up during November even as equity markets generally climbed most of the month. The CBOE Volatility Index (VIX), a measure of expected stock market volatility surged to 27. Inflation and supply chain concerns weighed on investors, contributing to volatility.
by Matt Orseske 