Wait, what? The Fed cut interest rates and bond yields went up, not down. Yes, you read that right.
The current global expansion has been characterized as one of US exceptionalism. Despite many developed market economies outperforming low expectations, the robustness of the US expansion has stood out. We believe this can continue based on differences between the US and European economies.
Change is the sum of fundamental trends, the gradual elimination of accumulated extremes, and the random arrival of new shocks.
Last week showcased the complexities driving markets and the economy, with inflation data, Federal Reserve commentary, and political developments at the forefront. While inflation metrics in the CPI came in as expected, the PPI surprised on the higher side, pushing up estimates for the Fed's preferred PCE inflation gauge.
The Federal Reserve (Fed) Chairman seems to be happy with the market’s new wisdom regarding the path of interest rates going forward.
Market prognosticators and the financial media will often point to a particular piece of anecdotal evidence as bullish or bearish. Quite often, the evidence is intuitively appealing as a contrarian indicator.
The S&P 500 index has had a spectacular run from its October 2022 trough to its present all-time peak, which has some (me included) wondering when the bull market will end. I approach this question in three steps.
If Wall Street learned one thing during Donald Trump’s first term as president, it’s that the stock market is a way he keeps score. At various points he took credit for equities rallies, urged Americans to buy the dip, and even considered firing Federal Reserve Chairman Jerome Powell, who he blamed for a selloff.
With President-elect Donald Trump set to assume office in January, the U.S. military and cybersecurity sectors could experience sweeping changes, creating opportunities for investors who recognize the long-term growth potential in defense and technology.
The Northern Trust Economics team shares its outlook for U.S. growth, employment, inflation and interest rates.
Declining inflation has been a theme for the economy since mid-2022, but we still believe the road may have some curves.
Municipal bonds broke their winning streak in October, posting negative total returns alongside broader fixed income assets.
Traders see an interest-rate cut next month as a coin toss as resilient economic data empowers Federal Reserve officials to take a potentially more-cautious approach to easing.
Gold traded near a two-month low, on course for its worst week since June 2021 as traders wind back expectations for a Federal Reserve interest-rate cut next month.
The highest Treasury yields in months — reached Friday after a batch of strong economic data cast additional doubt on whether the Federal Reserve will cut interest rates again next month — proved appealing to bond investors.
This isn’t the same China that greeted Donald Trump after his first win in 2016. The economy, once widely believed on a course to knock the US off its perch as the preeminent commercial power, has since revealed some acute vulnerabilities that don’t seem to be going away. And the president-elect seems to be gearing up for a trade war he no longer needs to fight.
U.S. rate cuts of up to 200bps are anticipated by the end of 2025 but with significant further downside if recession risks materialize.
One of the core principles of a long-term dividend portfolio is to invest in companies that are integral to society and will be for many years to come. Transportation falls into that category.
Much of modern finance falls into one of two camps, neoclassical finance and behavioral finance. The former posits efficient markets, the latter posits the opposite.
US producer prices picked up in October, fueled in part by gains in portfolio management costs and other categories that feed into the Federal Reserve’s preferred inflation gauge.
Your fixed income strategy does not necessarily need to be adjusted based on every personnel or environmental change.
While history shows that U.S. markets tend to perform regardless of political leadership, the full impact of Trump’s policies could bring new challenges and opportunities for investors globally once he is in office.
Recent insights from Natixis Investment Managers breaks down a few fixed income risks that investors may not be aware of.
Treasuries held on to recent losses ahead of the US inflation report, with traders loading up on bets for further declines in anticipation that Donald Trump’s pledged policies will fan price increases and keep interest rates high.
A surge in Bitcoin that paused earlier Wednesday is regaining steam, sending the original cryptocurrency above $90,000 for the first time, as traders assess the remaining market impact of President-elect Donald Trump’s rhetorical support for crypto.
Last week’s developments mark one of the most pivotal weeks in recent memory.
From beginning to end, the 2024 election cycle will be looked back on as historic
With a "Red Sweep" in Washington likely, markets are now pricing in a more aggressive policy agenda.
Investors are piling into US leveraged loan ETFs, betting that President-elect Donald Trump’s policies will potentially boost inflation and push the Federal Reserve to keep interest rates higher for longer.
The US Federal Reserve and its chair, Jerome Powell, are rightly choosing not to act on any assumptions about what Donald Trump might do as president. That said, if he follows through on his more extreme campaign promises, they’ll struggle to contain the economic consequences — a problem that equity investors ignore at their peril.
All year, a slew of Wall Street pros have questioned the durability of an indiscriminate risk rally that has fattened stock prices by trillions of dollars, sent Bitcoin soaring, fueled a credit bonanza, and more.
The Fed cut rates by 0.25%, with limited changes to the statement, while Powell's blunt "no" response about any coming political pressure to resign was headline grabbing.
The prospect of a Trump presidency has led to much debate and speculation about how markets might react. Depending on what policies are eventually passed, there are potential risks and opportunities in both the stock and bond markets.
The bond-market selloff unleashed by Donald Trump’s presidential victory last week ended almost as quickly as it began.
Most of the time the yield on long-term bonds exceeds that on short-term bonds, in order to compensate for the greater risk attached to long-term debt. But until recently the yield curve was inverted, with short-term rates exceeding long-term rates. This happens when investors expect interest rates to decline in the future.
On the latest edition of Market Week in Review, Chief Investment Strategist for North America, Paul Eitelman, discussed key watchpoints for investors in the wake of the U.S. elections. He also explained how the election results are impacting markets, and finished with an update on the latest monetary policy decisions from the U.S. Federal Reserve (Fed) and the Bank of England (BoE).
We are in a world where multiple, starkly different outcomes are possible. The decisive U.S. election outcome has stoked uncertainty about future U.S. policy.
The people have spoken. While there are still some unknowns, the contours of the American government that will be seated next January are reasonably clear.
In the report, Global Head of Fixed Income Jim Cielinski and Head of Global Short Duration Daniel Siluk believe navigating the change in rate regimes has grown more complicated for the Federal Reserve (Fed) as they must now consider the ramifications of Donald Trump’s proposed economic policies.
Following the September FOMC meeting’s much ballyhooed 50-basis point (bps) rate cut, the voting members scaled back and reduced the Fed Funds by 25 bps this time around.
Marc Pinto, Head of Americas Equities, and Lucas Klein, Head of EMEA and Asia Pacific Equities, say a surprisingly straightforward U.S. election could provide additional momentum to U.S. stocks through the end of 2024. But it remains to be seen how policy will impact future earnings—the real driver of long-term returns.
This is not a typical business cycle. We see structural forces holding inflation higher long term, keeping the Fed from cutting as much as markets expect.
If we had to choose one indicator to watch over the next few months, it would be weekly initial jobless claims.
Investors have been married to their money market funds for the better part of the last two years.
Better than expected economic data drove interest rates higher, changing the market narrative and contributing to an equity market pullback early in the month. This unraveled expectations of further rate cuts by the Federal Reserve (Fed) and resulted in real rates moving higher. The 10-year Treasury has moved up 48 basis points, ending the month at 4.27%.
Things are looking up for bonds - learn what makes them a great addition to your portfolio right now.
The Fed’s rate cut last month has not jumpstarted U.S. housing market. Buyers need lower rates to get back in the game.
Credit risk fell in reaction to Donald Trump’s US presidential win, even though his presidency may be marred by tariffs and possible trade wars.
U.S. equity-market leadership reversed course during the third quarter of 2024, with small cap stocks outperforming their large cap counterparts and the value factor beating the growth factor.
Last week's jobs report hit a "sweet spot" for the markets, confirming enough economic cooling to signal potential Fed rate cuts without yet sparking fears of a recession. I expect a 25-basis-point cut from the Fed this week and Powell may set us up for a data-dependent pause in December.
