Commodities

The U.S. International Trade in Goods and Services, also known as the FT-900, is published monthly by the Bureau of Economic Analysis with data going back to 199 and details U.S. exports and imports of goods and services. Today's headline number of -39.93B was lower than the Investing.com forecast of -40.0B. 

The world’s developing nations have yet to experience the full effects, both economic and humanitarian, of the pandemic.

CIO Larry Adam discusses the COVID-19 outbreak and emphasizes that investors should exercise patience, not panic.

To say that a lot has changed in the last month is a tremendous understatement. The markets are playing a weak supporting role to the worst healthcare challenge in our generation, as well as the worst economic problem since 2008.

According to John Sheehan, the recent selloff in Investment Grade fixed income was exacerbated by technical factors. In his view, regulatory changes implemented after the 2008 crisis removed a critical shock absorbing mechanism that caused spreads to spike.

From its all-time high on February 19, the S&P 500 hit a bottom of 2,237 on March 23. But it will go lower this year, according to Jeffrey Gundlach, and only then will he buy stocks.

This morning the Institute for Supply Management published its monthly Manufacturing Report for March. The latest headline Purchasing Managers Index (PMI) was 49.1, a decrease of 1.0 percent from 50.1 the previous month. Today's headline number was above the Investing.com forecast of 45.0 percent.

The March US Manufacturing Purchasing Managers' Index conducted by Markit came in at 48.5, down 2.2 from the 50.7 final February figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.

In a typical recession, the global economy tends to have large imbalances that take a long time to unwind, such as a housing bubble or overinvestment by businesses. This time the global economy is experiencing a shock, rather than the natural end result of a slow build-up of excesses.

With today's release of the January S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.31% month over month which is cut to -0.04% with inflation adjustment.

Much will depend on how fast businesses bring back jobs.

The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, fell to 47.8 in March from 49.0 in February, which is in contraction territory. Values above 50.0 indicate expanding manufacturing activity.

Uncertainty continues to dominate global securities markets and heightened volatility is the result. Feifei Li, partner and head of equities, asks Rob Arnott, the founder and chairman of Research Affiliates, about the implications of increased volatility on investment strategies and where investors can find the best opportunities.

The Bloomberg Barclays U.S. Green Bond Index is down 2.5% so far this year -- far less than the 5.1% drop seen in the investment-grade, corporate debt benchmark.

Not everyone sees the bottom as necessarily reached.

This article will tackle the big news. Saudi Arabia announced that it will increase oil production from 9.7 million barrels a day to 10 million and then to 12 million if needed. This news alone sent the oil price down 20% – and the whole stock market with it.

Michael Grant is preparing for rebound in equities and has positioned the long/short portfolio accordingly. To use a Wayne Gretzky analogy, he is skating to where the puck will be, not where it is.

On Friday, Congress approved and President Trump signed into law a $2.2 trillion emergency stimulus package, the largest in U.S. history. Most American adults will be receiving a one-time payment of $1,200 in cash.

Personal Income (excluding Transfer Receipts) in February rose 0.61% and is up 3.7% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) MoM was up 0.52%. The real number is up 1.9% year-over-year.

After giving our clients a few days to digest it, we’d like to share this memo from Thursday with all of our readers. We hope you’ll find it helpful.

Sierra Mutual Funds Chief Investment Officer Terri Spath's latest market commentary discusses when might be a good time to buy, and the importance of using a time-tested process, like the one used at Sierra and Ocean Park.

As both traditional and alternative asset markets descend into turmoil this month, it’s important to remember the inherent strengths of a diversified portfolio. A market rout always causes correlation to go to 1 across virtually all assets as investors flee to the perceived safety of cash.

I expect that the most valuable aspect of our investment discipline over the completion of this cycle will be our ability and willingness to flexibly respond to changes in observable market conditions as they emerge.

As if the Fed’s unlimited QE wasn’t enough, we’ll get a $2T stimulus now. Predictably and much to our subscribers’ delight, the S&P 500 loved that. As it sprang to life, we’ve already cashed in an 82-point profit on that upswing.

The Census Bureau has posted the Advance Report on Durable Goods New Orders. This series dates from 1992 and is not adjusted for either population growth or inflation. Let's now review Durable Goods data with two adjustments.

A global recession is likely through the first half of the year, with a rebound possible during the second half of 2020, provided the virus threat subsides.

On the heels of the Fed’s unlimited QE promise, the S&P 500 sprang to life finally. All the gains though were given up in less than three hours. As the futures keep climbing overnight, does it herald a turnaround?

Oil’s back below $30 and suddenly it feels like 2016 all over again. Only it’s not. Saudi Arabia’s 2015-2016 production boom was a war on US shale. This time, Saudi Arabia is waging a war for market share against Russia and the US. It’s a war with no winners, least of all US fracking.

That was the last time the world witnessed a sustained downturn in both emerging markets and their developed-nation counterparts.

Over a period of time which I cannot estimate yet, I will continue my preparation for a far different economic and financial environment. Capital deployment strategies will likely have to change from what has been the norm in the post WW2 environment. We are in a New World Order.

We know a lot more about COVID-19 than we did a few weeks ago; but there remain questions that are unanswerable at this stage. We don’t know how much worse this gets before it starts to get better...

Hopes for a pact between Texas oil and OPEC have begun to unravel.

Given the magnitude, and multiple confirmations, of these signals, it is far too soon to assume the “bear market” is over. This is particularly the case, given the selloff is less than one-month old.

Research Affiliates assesses the potential impact of COVID-19 on economies and investments, and what it means for the All Asset strategies.

The impact of the coronavirus on the US economy still isn’t fully known yet, as the situation continues to evolve. However, Franklin Equity Group’s Grant Bowers sees at least three reasons to be optimistic about the long-term recovery.

We entered into the current crisis with a whole financial system that had been incentivized by policymakers to take on excessive levels of debt and leverage. The turmoil we are seeing right now is the result of the unwinding of this leverage.

"The data through February were unlikely to have been affected much by the COVID-19 outbreak. Economic data for March will be incorporated in the next CFNAI released on April 20, 2020." The Chicago Fed National Activity Index (CFNAI) increased to 0.16 in February from –0.33 in January. Two of the four broad categories of indicators that make up the index increased from January, and three of the four categories made positive contributions to the index in February. The index’s three-month moving average, CFNAI-MA3, decreased to –0.21 in February from –0.11 in January

These extreme measures appear to be having great success, particularly in Asian countries. Whereas the number of cases continues to rise in Italy, Spain, Iran and elsewhere, the number has begun to stabilize, if not plateau, in Asian countries.

Growing policy responses reflect greater estimates of the costs of COVID-19.

Growing policy responses reflect greater estimates of the costs of COVID-19.

That was President Donald Trump on Monday, responding to a question on whether the U.S. economy could be sliding into a recession.

While it is certainly hoped by many that we are closer to the end of the liquidation cycle, than the beginning, the dollar funding crisis, a blowout in debt yields, and forced selling of assets, suggests there is likely more pain to come before we are done.

Without the right programs, this shortfall in credit availability will increase and it will further deepen the crisis.

On Thursday, March 12, Rick Raczkowski, co-lead portfolio manager of Core Plus Fixed Income participated in a conference call with clients to discuss recent events and market activity. He discussed that while there is a lot of fear and uncertainty in the market right now he and co-lead portfolio manager Peter Palfrey, are maintaining their discipline of managing through the cycle as they have for the past 20 years.

On Friday, March 13, Loomis Sayles’ Global Fixed Income team held a conference call to discuss the current market environment, policy responses and potential opportunities. Here, portfolio managers Lynda Schweitzer and Scott Service summarized a few key points.

A burgeoning Wall Street strategy that’s been pitched as a shelter from storms is proving anything but in this once-in-a-century market turmoil.

Here are the signs that the world is focused on liquidity above all else.

Futures are now at the lowest level in almost two decades after Saudi Arabia signaled it’s doubling down on a price war with Russia just as demand evaporates

As COVID-19 spread around the world in the early months of 2020, governments enacted quarantines, travel bans, school closings and other measures. Global supply chains were disrupted. Reduced demand is weighing on many industries, starting with travel, hospitality and leisure. Oil prices dropped after Saudi Arabia boosted production, in effect launching a price war with Russia. U.S. Treasury yields fell to record lows.

In recent weeks, COVID-19 has led to escalating economic concerns. What started as a seemingly sharp, but likely temporary, reduction in Chinese activity, including disruptions to global supply chains, became more worrisome as the coronavirus moved to the rest of the world.

Municipal closed-end funds (“CEFs”) currently offer high levels of tax advantaged income and can often be purchased at a discount to their current net asset value.

As coronavirus-related market volatility expands into municipal bonds, the Franklin Municipal Bond Department explains how they are navigating an increasingly challenging muni-market environment. They also share reasons why they believe a longstanding preference for high-quality municipal bonds supports their efforts to turn volatility into opportunity.

Gundlach’s survey of the economic and financial destruction wrought by the coronavirus shows problems abound.

A number of cash-rich family offices poised to benefit from tumbling markets.

Consistent with misapprehensions expressed during other recent market crises, there has been a chorus of alarmist speculation about the actions and state of risk-parity strategies during the current crash. We felt it would be helpful to revisit the concept of risk parity and take a snapshot of how a typical global risk parity strategy might have been expected to behave this year.

Month-over-month nominal sales in February decreased by 0.5% (0.53% to two decimal points). Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, decreased by 0.6% (0.62% to two decimal points).

This year feels so much like late in 1981, late in 1999 and late in 2008 to us. The first reaction by investors was to flush whatever they had left in economically sensitive stocks. Then, as if there hadn’t been enough torture for value investors today, Saudi Arabia decided to chop the knees out from under the oil industry in the U.S.

A déjà vu of 2008 in markets lately? Mike explains why we think the coronavirus shock should not spark a 2008-style crisis.

The latest crash in oil prices is threatening to push $140 billion of investment-grade energy debt over the edge into junk.

Some clients want to free up cash for investment opportunities, others to offset the cost of margin calls after borrowing against stock holdings.

We have a full economic calendar. Only the FOMC decision will get major market attention. Initial jobless claims provide a post-virus look at the job market. Housing data remains interesting. Despite this, the media focus will remain on the coronavirus crisis.

In terms of excitement, investing usually rivals watching paint dry. That has not been the case lately.

What happens to environmental, social and governance-oriented investment in a market shock? We’re about to find out.

The market for funds that focus on environmental, social and governance investment principles has ballooned in recent years with more than 1,000 opening since 2015.

Coronavirus is a global pandemic that few if any could have predicted, but it’s deteriorating fundamentals throughout 2019 into 2020 that set the table for the recent extreme market volatility. Now that volatility has clearly arrived, what‘s the strategy when black swans swim?

Stocks rebounded on Friday, ending a week of wide swings that drove major U.S. stock indexes into bear-market territory. Overall, it was a rough week for the stock markets.

In recent weeks, we’ve seen economic concerns about COVID-19 moving from supply chain disruptions, to expectations of softer global growth, to fear of the impact from social distancing. The odds of a recession have been rising day by day. Some economists believe that we’re already in one.

Substantial fiscal policy is the best economic prescription for COVID-19.

Falling oil prices can be a double-edged sword in terms of economic impact: welcomed by consumers, but not by producers. Franklin Templeton Emerging Markets Equity’s Bassel Khatoun shares his thoughts on the impact of lower oil prices on emerging market economies and some considerations for investors

Compared to past viral outbreaks, COVID-19 appears to be less fatal, yet it has received far more media coverage. Paradoxically, that may be part of the reason why it’s had a much bigger impact on public health and the economy relative to those other diseases.

The coronavirus could take us all someplace we really don’t want to go.

The Loomis Sayles Alpha Strategies team shares some insights as markets grapple with three issues: the impact of COVID-19, an oil fight and a crisis of confidence in Western governments.

Stocks have plummeted this month as investors struggled to assess what impact the COVID-19 coronavirus may have on the economy.

The S&P 500 triggered the week’s second trading halt by falling more than 7% during Thursday’s market hours.

Russ discusses the reasons why gold can be an effective hedge going forward.