The US House of Representatives passed a tax reform bill on November 16. How could it affect financial and real estate stocks?
The current equity bull market has been chugging along, enjoying unusually low volatility in recent quarters. The S&P 500® Index is on an extended bull run. The index hasn’t had so much as a 5% correction since February 2016, and it has gone without a 20% or greater pullback since March 2009.
Global growth has chugged along at a modest pace throughout 2017, and I expect more of the same heading into 2018. Read on for a visual snapshot of our key themes across the globe.
Does the high yield bond market offer enough value at this point in the credit cycle?
The Trump administration announced Jerome Powell as its choice for Federal Reserve Chair on November 2. The following are some thoughts on what we could expect from a Powell appointment.
China’s 19th Communist Party Congress is fast approaching. While the meetings are primarily a political event, they will shed some light on the party’s broad economic goals. There will also be major reshuffling across party leadership this year.
Has China’s renminbi unseated the Japanese yen as the new “safe haven” currency in Asia? Some market commentators have adopted this view given the renminbi’s recent strength, intensifying geopolitical tensions in Asia and Japan’s proximity to North Korea.
With limited evidence of excess in the global financial system and mostly low interest rates around the world, we remain optimistic about global economic prospects. The expansion is poised to continue, led by growth in emerging economies.
Eight years into its run, the global expansion looks poised to continue. What might this mean for asset markets?
Current estimates show a significant gap between the rate expectations of Wall Street economists and the Fed funds futures markets. The spread between their estimates for December 2019 is nearly 100 basis points, the equivalent of roughly four rate hikes. Over time, this gap in expectations is going to close one way or the other.
The Federal Reserve’s balance sheet has been grabbing headlines recently, and with good reason: the Fed’s three massive bond buying programs, used to stimulate the US economy during and after the 2008 financial crisis, have left the central bank holding trillions of dollars worth of Treasury and agency mortgage-backed securities (MBS).
It’s a common misconception that credit and equity performance move in tandem. When can divergence occur and how can credit investors prepare?
In early August, the National Federation of Independent Business (NFIB) released a small business survey that revealed an upbeat assessment of the labor market. Firms have lots of job openings and they are planning to hire, but they are having a hard time finding qualified applicants; the quality of labor is a problem.
Many income-seeking investors may need a new approach in today's low-yield environment. Loomis Sayles can offer a unique solution.
When talking with potential investors, a refrain we often hear is, “I was burned by bank loans before, and now I’m not sure if I should buy them again.” Is this fear unique to the bank loan asset class?
After taking a hit earlier this summer, oil prices have climbed back around $50 a barrel. What’s my advice on oil price volatility? Hang in there. The good news—we’ve been through this before. The bad news—we’ve been through this before.
London office property prices have stayed surprisingly high since the Brexit vote to leave the European Union (EU) in mid-2016. A recent rise in vacancy levels (from a low base) hasn’t yet made a dent in high rent costs, while low transaction prices have attracted foreign buyers lured by the post-Brexit fall of the British pound.
After a dip in global real economic growth last year, when a collapse in oil prices crushed the energy sector and related industries, I see global real GDP growth climbing to about 3.4% this year, leveling off through 2018.
Fourteen Loomis Sayles investment experts address the key issues they’re watching for the remainder 2017. Read on for their insights.
The Fed is withdrawing from the MBS market, but we see a number of positives supporting agency MBS over the next 6 to 12 months.
Investor confidence in the global outlook for monetary policy, economic growth and inflation has kept volatility contained. Can it continue? We think the risk of a destabilizing policy error is low if central banks remain cognizant of global financial conditions.
Investor confidence in the global outlook for monetary policy, economic growth and inflation has kept risk appetite high and volatility contained. Can it continue?
In late May, OPEC (Organization of the Petroleum Exporting Countries) and non-OPEC oil producers agreed to extend production cuts through April 2018 in the face of oil inventories that remain well above average. While one would have expected a positive market reaction, many investors believed deeper cuts were necessary and the market has sold off sharply since the meeting.
UK politics are not stable after last week’s general election. When Prime Minister Theresa May called for a snap election in April, she sought to reaffirm her political mandate as Brexit negotiations launched.
This week’s Federal Reserve Open Market Committee (FOMC) meeting will be anything but boring. The Federal Reserve seems eager to move toward rate and balance sheet normalization, probably because President Trump is unlikely to nominate Fed Board Chair Janet Yellen for another term when her current term expires in January. I expect Yellen and her colleagues to take three steps this week.
Emerging market (EM) assets were hit hard by the crash in commodity prices in 2014-2015, but so far this year, EM and commodity performance have diverged. EM is one of the top-performing asset classes across global markets despite flat commodity prices. This doesn’t square with the market rule of thumb that EM tends to perform in line with commodity prices. I believe strong EM performance can continue if we begin to see global demand for commodities materialize; otherwise, this divergence could reverse.
A synchronized pickup in global economic activity has lifted the spirits of businesses, consumers and investors worldwide. Though many equity markets are near 52-week highs and credit spreads are near multi-year lows, corporate profits are now growing again in most countries.
Markets breathed a sigh of relief as centrist Emmanuel Macron won the French presidency on Sunday, May 7. Despite the seemingly good news, Italian bonds sold off as investors prepare for turbulent Italian politics ahead.
Global markets breathed a collective sigh of relief last week when it became clear that Geert Wilders' anti-European Party for Freedom (PVV) did not win the most votes in the March 15 Dutch election.
The global auto industry completed a successful year in 2016, driven by solid sales performance in the US, China and Western Europe.
So far, the market’s reaction to Turkey’s historic referendum on the adoption of a national presidential system on April 16 has been positive, with local bonds and the currency rallying. Despite a slim margin, this was a major win for President Erdoğan and the Justice and Development Party (AKP).
How might the new administration make good on its promise of a lower corporate tax rate? The House has proposed funding the cut with a new border tax on imports (BAT).
Recent trade actions against Chinese aluminum imports may result in higher tariffs. Ironically, the US and China have their interests aligned in this area.
The ongoing economic and profits recoveries mean global risk assets could see modest upside from here.
Auto insurers have been caught off-guard. Traffic deaths had been in decline for four decades, as a result of Mothers Against Drunk Driving (MADD), seat belts, crumple zones, anti-lock braking systems, air bags and a string of other safety improvements.
In 2017, the risks to the euro area stem from politics, not the economy.
We’re modestly optimistic about 2017, but there are a host of unknowns as we become acquainted with our new President Trump, what policies he may pursue, and how they will impact the world body politic. Loomis Sayles' sector teams weigh in on potential opportunities in the year ahead.
For the first time in quite a while, Washington could prove to be a source of positive earnings catalysts in the months ahead.
What a difference a few months can make. The world economy now looks to be on sounder footing, with economic data surprising to the upside, developed and emerging market economic momentum improving, global manufacturing recovering and the US profits recession ended.
European banks seem to be on an upward trajectory – although improvements are likely to come at a slow pace and with some risks.
Markets were in reflation mode during the final weeks of 2016, sending the 10-year US Treasury yield to its highest level in more than two years. While economic indicators have shown modest improvement, most of the rise in yields is built on lofty expectations. In the coming years, we think a strengthening macro backdrop may support modestly higher yields.
Every six months, we share insights from Loomis Sayles portfolio managers and analysts; what are the current themes and risks shaping their investment decisions? Looking into 2017, geopolitical shifts, rising rates, regulatory changes and new proposed policies from President-elect Trump will all be key factors.
It wasn’t much of a surprise that the Federal Reserve announced a 25 basis point rate increase today - its first hike in 12 months and the second hike since 2006.
Donald Trump’s presidential victory may have a mildly positive impact on US banks. A change in several economic factors could signal a more positive environment for banks.
Italy rejected Prime Minister Matteo Renzi's constitutional reform in Sunday’s referendum, as polls had predicted. But Italian voters didn’t just say “no,” they said “hell no!” with 59.1% voting against and 40.9% voting in favor.
The Trump victory has inflicted a heavy dose of uncertainty on the capital intensive global auto industry.
Many of the policies President-elect Trump discussed on the campaign trail align with current and past GOP tendencies but others seem diametrically opposed to GOP DNA.
Donald Trump’s presidential upset has stunned financial markets, which had heavily discounted a Clinton victory. What might Trump’s policy proposals mean for markets and key components of the US economy going forward?
Donald Trump's presidential upset has stunned financial markets, which had heavily discounted a Clinton victory. What might Trump's policy proposals mean for markets and key components of the US economy going forward?