Thursday, April 20, 2017 10:02 AM
The opening quarter of 2017 was a historic one for Wall Street as the Dow Jones Industrial Average topped 20,000 for the first time. Equities rallied through January and February, then lost momentum in March; even so, the S&P 500 had gained 5.53% YTD when the quarter ended. The Federal Reserve raised the federal funds rate for only the third time in a decade, in response to strengthening inflation pressure and other signals of economic acceleration. Consumer confidence remained high.
Monday, April 10, 2017 2:45 PM
More growth, more record highs, more uncertainty and more risk: the leading U.S. market theme today seemingly is one of quantity—more of virtually everything. We do expect one exception to the trend of “more”—returns. We anticipate modest returns from U.S. equities due to valuation and political realities. Consequently, we see even more need for active portfolio management and investor discipline.
Tuesday, January 24, 2017 4:27 PM
After a bearish start, 2016 ended up being a good year for the bulls. The Dow Jones Industrial Average sold off 6% in January, dropping below 15,500 as investors worried about sinking oil prices and a slowdown in China’s economic engine. Eleven months later, the blue chips were nearing the 20,000 mark. Wall Street rode through the market shock brought on by the Brexit, rallied after Donald Trump’s presidential election victory, and priced in an interest rate hike by the Federal Reserve. Energy futures saw huge yearly gains. The housing market maintained its momentum, even as mortgage rates began to increase. Unemployment declined, consumer confidence grew, and the manufacturing sector expanded again. Investors awaited 2017 with some optimism.
Tuesday, January 24, 2017 2:01 PM
As we begin a new year, investors are projecting their market predictions for 2017. Which sectors will be hot? Will the oil rally continue? What will be the election results in France and Germany? What will be the consequences of Brexit? Will established Trade agreements be dissolved? Will tensions with China, North Korea, Russia, Mexico culminate to anything meaningful? Will U.S. monetary policy continue to play a vital role? How will the Trump presidency shape the capital markets?
Tuesday, January 17, 2017 1:33 PM
THE QUARTER IN BRIEF
Two events strongly influenced U.S. and foreign financial markets in the fourth quarter – one unexpected by many, the other widely anticipated. Neither of them particularly upset investors. Donald Trump’s win in the presidential election led to a rally on Wall Street, and the Federal Reserve’s December interest rate hike was taken in stride, even as our central bank’s monetary policy stood out globally for its hawkishness. The S&P 500 ended up gaining 3.25% in three months. The United Kingdom scheduled its Brexit, and OPEC elected to trim oil output for the first time in eight years. Oil rallied, and so did the dollar; precious metals retreated. The housing sector showed strength even as mortgage rates ascended. On the whole, the most-watched U.S. economic indicators were encouraging.
Tuesday, January 17, 2017 12:53 PM
Fourth Quarter EPS Guidance and Trumponomics
The number of companies issuing negative EPS guidance for Q4 2016 (77) is below the five-year average (83) for a quarter, while the number of companies issuing positive EPS guidance for Q3 (34) is above the 5-year average (29) for a quarter.
At this moment, both markets and economic agents seem to believe in strong expansionary effects of future “Trumponomics”. It remains to be seen to what extent Trump will be able to meet these high expectations.