The U.S. economy contracted 9.5% through the second quarter, the worst single-quarter decline in gross domestic product (GDP) since the Commerce Department started tracking it in 1947. It was expected the report would show a dip, but it’s important to recognize what that dip represents.
Looking across the global opportunity set, we see potential for attractive yield, though uncertainties surrounding the global recovery suggest this is a time to be cautious.
The CFA Institute is accelerating a shift to computer-based testing because of the coronavirus pandemic.
Investors love ETFs, especially during these uncertain times.
The recent Treasury bond rally fits with our forecast that the recession has a second, more serious leg that will extend well into 2021, despite massive monetary and fiscal stimulus.
In the time since COVID-19 hit the economy and stock market, there has been three phases. First, the question was ‘when’ will the economy return to pre-COVID normal? Next came ‘sooner or later’? Recently, we have moved to ‘will the economy ever come back’? For long-duration investors like us, what are the investment implications in where we are now in a U.S. stock market with many securities priced for ‘never’?
The Loomis Sayles Alpha Strategies Team answers three questions on corporate health, regime models and opportunities in emerging markets.
Americans have plenty of education, talent and experience — but an ever-ready supply of less expensive and more dependent guest workers gives companies less incentive to invest in them.
Here is the latest update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month.
We have upgraded our near-term economic outlook on the US economy, as some encouraging economic data has come out recently. However, the ongoing COVID-19 crisis, including recent spikes in cases throughout the country, ongoing social distancing measures, international and domestic tensions, and the threat of a return of lockdowns means investors should not get too complacent.
Real GDP was reported to have fallen at a 32.9% annual rate in 2Q20. Nobody should have been surprised by that. Component data had already indicated massive and broad-based weakness and most economists’ estimates fell in the -30% to -35% range. News reports had generally implied that the downturn was ongoing. That’s clearly not that case...
Several equity factors diverged significantly from their typical performance patterns during the COVID-19 crisis. By understanding how factor returns behaved in this market correction relative to their historic norms, investors can not only prepare for future volatility but also take advantage of short-term market dislocations.
Loomis Sayles Portfolio Manager Ashish Chugh provides an update on emerging market equities and the impact COVID-19 has had on them recently.
According to a new study by the left-leaning Roosevelt Institute, a universal basic income could permanently make U.S. economy trillions of dollars larger. While such socialistic policies sound great in theory, history, and data, show it isn’t the economic savior it is touted to be.
Record state budget gaps could reignite efforts by officials to reduce pension benefits, raise employee contributions or eliminate traditional pensions altogether.
Florida’s favorable tax laws have long been a draw for high-net-worth individuals, but the pandemic’s disruptions -- to work, school, public safety and northern states’ budgets -- have increased the allure.
This morning the Institute for Supply Management published its monthly Manufacturing Report for July. The latest headline Purchasing Managers Index (PMI) was 54.2, an increase of 1.6 from 52.6 the previous month. Today's headline number was above the Investing.com forecast of 53.6 percent.
The July US Manufacturing Purchasing Managers' Index conducted by Markit came in at 50.9, up 1.1 from the 49.8 final June figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
Two companies in the metals and mining space I’m looking forward to hearing from are Ivanhoe Mines and Franco-Nevada. Both are scheduled to report next week.
How will our lives change during and after the pandemic? Let’s start with a look at education, medicine, automation, broadband access, city living and cash.
Big things have been brewing in Europe. The same continent that two years ago I said was going through “monetary drug withdrawal,” is now set to outpace US growth by a wide margin. And US growth, which had led the world for years, now looks likely to lag it.
With the release of this morning's report on June Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal -1.46% month-over-month change in disposable income was at -1.82% when we adjust for inflation. This is an increase from last month's 5.15% nominal and 5.26% real decreases last month. The year-over-year metrics are 8.38% nominal and 7.58% real.
About two-thirds of this month’s comment is about COVID-19 and the risk of a second wave. This is not only for the sake of public health, which would be enough, and not only to contribute to a better understanding of the epidemic.
The U.S. dollar has fallen by about 7% against a broad basket of currencies since its mid-March peak. After a nearly decade-long bull market that saw it appreciate by more than 40%, we believe the dollar could be headed for a longer-term decline.
Between the biggest week of earnings, the Fed meeting, and key economic data, there were plenty of headlines ‘hot off the press’ for the financial markets to handle this week, and as we look ahead, some of these same developments, as well as a few others still have the potential to ‘turn up the heat’ on market volatility.
The Federal Reserve wants financial conditions to remain accommodative as it looks to support the U.S. recovery.
Today, we take a look at several of the best performing thematic ETFs of 2020.
The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, rose to 51.9 in July from 36.6 in June, which is in expansion territory after 10 consecutive months in contraction territory. Values above 50.0 indicate expanding manufacturing activity.
At a time when health insurance coverage is of vital importance, what are the options for your newly unemployed clients? The answer to that question depends on a new regulatory change involving COBRA coverage.
The reductions are part of sweeping measures -- from staff salary freezes to suspending new hiring -- that U.S. colleges are taking to contend with the financial fallout from the Covid-19 pandemic.
The pandemic creates a good opportunity to make Social Security more sustainable.
The Commerce Department will release its first estimate of second quarter Gross Domestic Product on Thursday of this week, and it is widely expected to be really bad due to the economic lockdown earlier this year. Most forecasters expect 2Q GDP to be down 30-50%, making it the worst quarterly downturn since the Great Depression.
The Fed left rates unchanged near-zero, as expected, while emphasizing that “the path of the economy will depend significantly on the course of the virus.”
But two priorities stand out.
While the economic restart has helped put 7.5 million Americans back to work in May and June combined, payrolls are down more than 14.5 million from their pre-pandemic peak.
The accompanying chart is a way to visualize real GDP change since 2007 and uses stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.
This morning's seasonally adjusted 1.43M new claims, up 12K from the previous week's revised figure, was better than the Investing.com forecast of 1.45M.
US Investment-grade corporate bond issuance has rolled past US$1 trillion so far in 2020. What are the long-term effects of this explosive borrowing?
Our Fixed Income CIO Sonal Desai unveils the first insights from the new Franklin Templeton–Gallup research project on the behavioral response to the COVID-19 pandemic and implications for the recovery.
At the start of the year, when COVID-19 was barely on anyone's radar outside of China, the global economy was entering a fraught phase, facing a range of potentially devastating tail risks. And though the pandemic has since turned the world on its head, all of these threats remain – and some have become more salient.
We face an important economic calendar and earnings reports from 192 companies in the S&P 500. We will get important data on sentiment, personal income and spending, housing, employment claims, inflation, manufacturing.
Despite the surging stock market from the March lows, trillions in liquidity support from the Fed, retirement confidence declined.
These efforts are unlikely to impress students paying tens of thousands of dollars for in-person instruction.
The vice chairman of Loomis Sayles and one of the world’s best-known bond investors gives his take on the economy and what may happen next.
Today the National Association of Realtors released the June data for their Pending Home Sales Index. According to the National Association of Realtors®, "Pending home sales continued to ascend in June, sustaining two consecutive months of increases in contract activity."
Thus far the market has shrugged off the recent rise in Covid cases, but the situation remains fluid. In our view, the best strategy is to invest in companies that are able to grow during this time of stress, either organically or by increasing market share as weaker competitors fall by the wayside.
Now more than ever, investors are looking to their advisors for reassurance and a plan for the future. And in order to create that plan, advisors MUST be able to correctly assess a client’s risk tolerance.
In addition, advisors need to be able to communicate that plan effectively and consistently, all while managing their client’s fears and concerns.
Because of this, advisors’ coaching skills are more important than ever. Helping clients understand and manage risk can be tricky, but with direct conversations, along with technology tools that help capture, access and monitor risk tolerance, new client engagement opportunities and better outcomes emerge.
Join us on this informative webcast that will provide you with best practices on engaging clients, in the ever important risk tolerance discussion.
Earnings have so far bested an extremely low bar, but stocks may be discounting too swift a recovery; while concentration remains a risk.
Digital transformation was already underway prior to the COVID-19 pandemic, but the resulting economic crisis has caused an acceleration, according to Franklin Equity Group’s Jonathan Curtis. He shares where his team is looking for potential opportunities within technology during the current period and beyond.
The headline number of 92.6 was a decrease from the final reading of 98.3 for May. Today's number was below the Investing.com consensus of 94.5.
Ultimately, we believe that investors who are unaware of ESG and do not integrate ESG into their investment processes may be exposing themselves to additional, unnecessary and possibly unrewarded risks.
Anyone still expecting the fixed interest payments from Treasuries, or even high-quality corporate bonds, to outpace inflation in the coming years is just setting themselves up for disappointment.
Over the last decade, the general trend has been consistent: The rate of home ownership continues to struggle. The Census Bureau has now released its latest quarterly report with data through Q2.
With today's release of the May S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.04% month over month which is cut to -0.22% with inflation adjustment.
Once we get the pandemic under control, working from home will be welcomed by cost-cutting companies and staff who dread the daily commute. But for the owners of commercial property the consequences may be severe.
A large iShares ETF investing in companies with positive ESG characteristics has produced a total return this year more than three times the performance of the S&P 500.
Markets rebounded during the second quarter, aided by monumental support from the Fed. We expect the economy to continue improving, but given the recent wave of Covid cases we also expect some bumps along the way.
Does 9 times higher yield in EM than in US bonds make for an attractive investment proposition? We lay out the arguments.
Right now, it looks like the US economy shrank at a 35% annual rate in Q2. To put that in perspective, the worst quarter we've ever had since the military wind-down immediately following World War II was -10% in the first quarter of 1958, when, not by coincidence, the US was hit by an Asian flu. This is going to shatter that record by multiples and will likely be the worst since the Great Depression.
Rob Arnott has a warning for everyone who is confident they’ll know when it’s time to sell a soaring stock like Amazon.com Inc. or Tesla Inc.
The key to successful ESG investing lies in the finer points of process automation.
Tesla’s market capitalization just crossed $300 billion. It’s the largest car maker in the world. Tesla’s market cap implies that its production will go up from the 400,000 cars a year it produces today...
I’ve long been a believer that markets are generally efficient (for large cap stocks in the U.S, at least). As such, I’m always skeptical of advisors that peddle their ability to select individual stocks that they claim will beat the market over the long term.
We all know that past performance is no guarantee of future results, but you can see in the chart below that the white metal could possibly be setting up for another epic run-up. At this stage of the bull market, silver’s current price appreciation is ahead of any previous rally.
The U.S. and EU deliberate how to disburse aid, China’s recovery carries risks, and U.S. mortgage rates find a floor.
We’ll start with a dozen or so charts showing the market is either very highly valued, or extremely overvalued, or merely stretched. But in general, you will see markets are indeed at the upper end of historical valuations. Then we’ll consider some reasons why this is so, and why stocks could even go higher.
Investors must balance ongoing risks of the coronavirus against the extra yield the bonds provide.
After four days of intense negotiations, EU leaders have reached agreement on a €750 billion recovery fund to help repair the economic damage from COVID-19. It took several concessions to EU creditor countries to break the deadlock. As expected, total grants in the deal have been reduced to €390 billion from an original €500 billion proposal.
Both gold and silver have been on a tear this week, with the yellow metal touching a nine-year high of $1,897 in intraday trading on Thursday. Silver was trading above $22.70, up 94 percent from its 52-week low on March 18.
This morning's release of the June New Home Sales from the Census Bureau came in at 776K, up 13.8% month-over-month from a revised 682K in May.
European measures applied to mitigate the effects of the pandemic have contained the unemployment rate in Europe more than in the U.S. While recognizing economic risks from the rising number of COVID-19 cases in the U.S., our forecast sees this success ratio reversing before the end of the year.
Higher-income assets underperformed in the second-quarter rebound. But that also means there’s pent-up potential in income-generating assets that may begin to show in later stages of the recovery.
The latest index came in at 3, up 2 from last month's 1, which indicates expansion in July. The future outlook increased from 9 last month to 14. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.
Parents are now uncomfortable sending their kids to child-care centers. Meanwhile, the U.S. child-care industry is in trouble.
Municipal bond investors will need to contend with the impact of monetary policy on market prices.
The unprecedented nature of the COVID-19 economic disruption has made traditional gauges of economic developments woefully inadequate, says our Fixed Income CIO Sonal Desai. She highlights the need to look deeper into new ways of examining the path toward recovery...
With less than four months to go until Americans cast their votes for president, we’ve fielded an increase in questions from clients as to whether the U.S. presidential election poses a risk to markets and the economy. The short answer is yes.
The latest Conference Board Leading Economic Index (LEI) for June was up 2.0% from the May final figure of 100.0.
The debuts of actively managed ETFs are outnumbering those of traditional funds at a record pace as issuers bet on investor demand for stock picking.
Widespread efforts to contain COVID-19, including closures of businesses, schools, and offices, has upended many aspects of our everyday lives. In this webinar, Global X’s thematic research team looks at how long-standing habits have quickly changed amid this disruptive environment and what it may mean for certain industries and themes going forward, including Video Games & E-sports, Robotics & AI, Cloud Computing, E-commerce.
Webinar attendees will:
Jay Jacobs, Pedro Palandrani, and Andrew Little will be available to answer your questions following the presentation.
This morning's release of the June Existing-Home Sales showed that sales rose to a seasonally adjusted annual rate of 4.72 million units from the previous month's 3.91 million. The Investing.com consensus was for 4.78 million. The latest number represents a 20.7% increase from the previous month, it's largest monthly increase ever, and a 11.3% increase year-over-year.
A point we have increasingly been making is the self-mitigating nature of: (1) market returns and (2) capital market assumptions (“CMAs”). There is a demonstrable pattern of CMAs coming down after significant rallies in equity markets and going up after a decline.
The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for May. U.S. house prices were down 0.3 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 4.9% (nonseasonally adjusted). After adjusting for inflation and seasonality, the index is down 0.08% in May and up 5.85% year-over-year (seasonally adjusted).
I have a client who is struggling with whether or not to retire. He is wondering if he is making a difference in his work or if he should just quit and, “do something good.” But it would be a bad financial decision.
In March, Bank Loans Portfolio Manager John Bell saw three different roads back to par, with market recovery in 6-12 months the most likely. How has the recent market activity changed his view?
Millions of Americans who bought insurance to help them pay for nursing or home-health care are now facing a tough call.
Recovering from Covid-19 may not offer much lasting protection from future infections for those with only mild cases, says the New England Journal of Medicine.
First quarter 2020 saw the U.S. economy in a tailspin; second quarter pulled out of it … but now is the recovery stalling?
Markets thus far in 2020 have been, to use an overused word, unprecedented. In a matter of months, we have witnessed economic and market moves that typically take an entire market cycle of many years to unfold. So, we truly do see 2020 as a year when investors are gaining “dog years” of experience.
COVID-19: Coronavirus Coverage
Second Quarter GDP Reflects Early Pandemic Response
The U.S. economy contracted 9.5% through the second quarter, the worst single-quarter decline in gross domestic product (GDP) since the Commerce Department started tracking it in 1947. It was expected the report would show a dip, but it’s important to recognize what that dip represents.
Income Fund Update: Focused on Finding Opportunities in Today’s Markets
Looking across the global opportunity set, we see potential for attractive yield, though uncertainties surrounding the global recovery suggest this is a time to be cautious.
CFA Exams Will All Be Taken on Computers in 2021 Due to Pandemic
The CFA Institute is accelerating a shift to computer-based testing because of the coronavirus pandemic.
America’s ETF Market Is Bigger Than Ever as Traders Dump Mutuals
Investors love ETFs, especially during these uncertain times.
Gary Shilling: Stocks May Start Sliding About 7 Weeks From Now
The recent Treasury bond rally fits with our forecast that the recession has a second, more serious leg that will extend well into 2021, despite massive monetary and fiscal stimulus.
Economic Normality: When? Sooner? Never?
In the time since COVID-19 hit the economy and stock market, there has been three phases. First, the question was ‘when’ will the economy return to pre-COVID normal? Next came ‘sooner or later’? Recently, we have moved to ‘will the economy ever come back’? For long-duration investors like us, what are the investment implications in where we are now in a U.S. stock market with many securities priced for ‘never’?
Alpha Strategies: Three Questions on What's Changed Since the March Madness
The Loomis Sayles Alpha Strategies Team answers three questions on corporate health, regime models and opportunities in emerging markets.
Why Tech Companies Want You to Believe America Has a Skills Gap
Americans have plenty of education, talent and experience — but an ever-ready supply of less expensive and more dependent guest workers gives companies less incentive to invest in them.
Is the Stock Market Cheap?
Here is the latest update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month.
US Recovery: Cautiously Optimistic - More of a "✓" Than a "V"
We have upgraded our near-term economic outlook on the US economy, as some encouraging economic data has come out recently. However, the ongoing COVID-19 crisis, including recent spikes in cases throughout the country, ongoing social distancing measures, international and domestic tensions, and the threat of a return of lockdowns means investors should not get too complacent.
The GDP Arithmetic
Real GDP was reported to have fallen at a 32.9% annual rate in 2Q20. Nobody should have been surprised by that. Component data had already indicated massive and broad-based weakness and most economists’ estimates fell in the -30% to -35% range. News reports had generally implied that the downturn was ongoing. That’s clearly not that case...
Capturing the Ups and Downs in Coronavirus Equity Markets
Several equity factors diverged significantly from their typical performance patterns during the COVID-19 crisis. By understanding how factor returns behaved in this market correction relative to their historic norms, investors can not only prepare for future volatility but also take advantage of short-term market dislocations.
Emerging Market Equities: Three Questions on What's Changed Since the March Madness
Loomis Sayles Portfolio Manager Ashish Chugh provides an update on emerging market equities and the impact COVID-19 has had on them recently.
Universal Basic Income Is Not An Economic Savior
According to a new study by the left-leaning Roosevelt Institute, a universal basic income could permanently make U.S. economy trillions of dollars larger. While such socialistic policies sound great in theory, history, and data, show it isn’t the economic savior it is touted to be.
States Pull Back on Pension Payments as Virus Ravages Revenue
Record state budget gaps could reignite efforts by officials to reduce pension benefits, raise employee contributions or eliminate traditional pensions altogether.
NYC’s Wealthiest Flocking to Florida Even While Covid Rages
Florida’s favorable tax laws have long been a draw for high-net-worth individuals, but the pandemic’s disruptions -- to work, school, public safety and northern states’ budgets -- have increased the allure.
ISM Manufacturing Index: Up 1.6 in July
This morning the Institute for Supply Management published its monthly Manufacturing Report for July. The latest headline Purchasing Managers Index (PMI) was 54.2, an increase of 1.6 from 52.6 the previous month. Today's headline number was above the Investing.com forecast of 53.6 percent.
Markit Manufacturing: "U.S. manufacturing operating conditions improve..."
The July US Manufacturing Purchasing Managers' Index conducted by Markit came in at 50.9, up 1.1 from the 49.8 final June figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
Ivanhoe Mines and Franco-Nevada Look Favorable Ahead of Earnings
Two companies in the metals and mining space I’m looking forward to hearing from are Ivanhoe Mines and Franco-Nevada. Both are scheduled to report next week.
How COVID-19 Will Change Our Daily Lives
How will our lives change during and after the pandemic? Let’s start with a look at education, medicine, automation, broadband access, city living and cash.
European Resurgence
Big things have been brewing in Europe. The same continent that two years ago I said was going through “monetary drug withdrawal,” is now set to outpace US growth by a wide margin. And US growth, which had led the world for years, now looks likely to lag it.
Real Disposable Income Per Capita in June
With the release of this morning's report on June Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal -1.46% month-over-month change in disposable income was at -1.82% when we adjust for inflation. This is an increase from last month's 5.15% nominal and 5.26% real decreases last month. The year-over-year metrics are 8.38% nominal and 7.58% real.
Avoiding a Second Wave
About two-thirds of this month’s comment is about COVID-19 and the risk of a second wave. This is not only for the sake of public health, which would be enough, and not only to contribute to a better understanding of the epidemic.
U.S. Dollar Outlook: What Could a Weaker Dollar Mean for Your Portfolio?
The U.S. dollar has fallen by about 7% against a broad basket of currencies since its mid-March peak. After a nearly decade-long bull market that saw it appreciate by more than 40%, we believe the dollar could be headed for a longer-term decline.
Weekly Investment Strategy
Between the biggest week of earnings, the Fed meeting, and key economic data, there were plenty of headlines ‘hot off the press’ for the financial markets to handle this week, and as we look ahead, some of these same developments, as well as a few others still have the potential to ‘turn up the heat’ on market volatility.
Fed Reinforces Commitment to Ongoing Monetary Policy Support
The Federal Reserve wants financial conditions to remain accommodative as it looks to support the U.S. recovery.
Nasdaq Dorsey Wright ETF Spotlight: Themes of 2020
Today, we take a look at several of the best performing thematic ETFs of 2020.
Chicago PMI Bounces Back in July, Out of Contraction Territory
The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, rose to 51.9 in July from 36.6 in June, which is in expansion territory after 10 consecutive months in contraction territory. Values above 50.0 indicate expanding manufacturing activity.
How the New COBRA Rules Affect Health Insurance Planning
At a time when health insurance coverage is of vital importance, what are the options for your newly unemployed clients? The answer to that question depends on a new regulatory change involving COBRA coverage.
Ivy League Presidents Take Pay Cuts Up to 25% in Crisis
The reductions are part of sweeping measures -- from staff salary freezes to suspending new hiring -- that U.S. colleges are taking to contend with the financial fallout from the Covid-19 pandemic.
A Payroll Tax Holiday Will Put the U.S. Back to Work
The pandemic creates a good opportunity to make Social Security more sustainable.
Brace Yourself For A Negative GDP Report On Thursday
The Commerce Department will release its first estimate of second quarter Gross Domestic Product on Thursday of this week, and it is widely expected to be really bad due to the economic lockdown earlier this year. Most forecasters expect 2Q GDP to be down 30-50%, making it the worst quarterly downturn since the Great Depression.
Policy of Truth: Fed Holds Rates Steady Amid Somber Outlook
The Fed left rates unchanged near-zero, as expected, while emphasizing that “the path of the economy will depend significantly on the course of the virus.”
Mohamed A. El-Erian: These Four Elements Map Out Sound Fiscal Policy
But two priorities stand out.
U.S. Economy Shrinks at Record 32.9% Pace in Second Quarter
While the economic restart has helped put 7.5 million Americans back to work in May and June combined, payrolls are down more than 14.5 million from their pre-pandemic peak.
An Inside Look at the GDP Q2 Advance Estimate
The accompanying chart is a way to visualize real GDP change since 2007 and uses stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.
Weekly Unemployment Claims: 1.4M New Claims
This morning's seasonally adjusted 1.43M new claims, up 12K from the previous week's revised figure, was better than the Investing.com forecast of 1.45M.
The Trillion-Dollar Question: Will the Corporate Borrowing Binge Cause Lasting Damage?
US Investment-grade corporate bond issuance has rolled past US$1 trillion so far in 2020. What are the long-term effects of this explosive borrowing?
They Blinded Us from Science
Our Fixed Income CIO Sonal Desai unveils the first insights from the new Franklin Templeton–Gallup research project on the behavioral response to the COVID-19 pandemic and implications for the recovery.
Revisiting the White Swans of 2020
At the start of the year, when COVID-19 was barely on anyone's radar outside of China, the global economy was entering a fraught phase, facing a range of potentially devastating tail risks. And though the pandemic has since turned the world on its head, all of these threats remain – and some have become more salient.
Time for A Look Under the Hood of the Economic Engine
We face an important economic calendar and earnings reports from 192 companies in the S&P 500. We will get important data on sentiment, personal income and spending, housing, employment claims, inflation, manufacturing.
Retirement Confidence Declined Despite A Surging Market
Despite the surging stock market from the March lows, trillions in liquidity support from the Fed, retirement confidence declined.
Colleges Tap Tech to Calm Students Paying for Remote Classes
These efforts are unlikely to impress students paying tens of thousands of dollars for in-person instruction.
Dan Fuss: Prepare for 1970s-Style Inflation
The vice chairman of Loomis Sayles and one of the world’s best-known bond investors gives his take on the economy and what may happen next.
Pending Home Sales Rise 16.6% in June
Today the National Association of Realtors released the June data for their Pending Home Sales Index. According to the National Association of Realtors®, "Pending home sales continued to ascend in June, sustaining two consecutive months of increases in contract activity."
Sticking with the Winners - Equity Investment Outlook July 2020
Thus far the market has shrugged off the recent rise in Covid cases, but the situation remains fluid. In our view, the best strategy is to invest in companies that are able to grow during this time of stress, either organically or by increasing market share as weaker competitors fall by the wayside.
How COVID-19 Changed the Risk-Tolerance Discussion Forever
Now more than ever, investors are looking to their advisors for reassurance and a plan for the future. And in order to create that plan, advisors MUST be able to correctly assess a client’s risk tolerance.
In addition, advisors need to be able to communicate that plan effectively and consistently, all while managing their client’s fears and concerns.
Because of this, advisors’ coaching skills are more important than ever. Helping clients understand and manage risk can be tricky, but with direct conversations, along with technology tools that help capture, access and monitor risk tolerance, new client engagement opportunities and better outcomes emerge.
Join us on this informative webcast that will provide you with best practices on engaging clients, in the ever important risk tolerance discussion.
Running on Faith: Are Stocks Discounting Too Powerful an Earnings Recovery?
Earnings have so far bested an extremely low bar, but stocks may be discounting too swift a recovery; while concentration remains a risk.
COVID-19 Crisis Accelerates the Digital Transformation Trend
Digital transformation was already underway prior to the COVID-19 pandemic, but the resulting economic crisis has caused an acceleration, according to Franklin Equity Group’s Jonathan Curtis. He shares where his team is looking for potential opportunities within technology during the current period and beyond.
Consumer Confidence Down in July
The headline number of 92.6 was a decrease from the final reading of 98.3 for May. Today's number was below the Investing.com consensus of 94.5.
Environment, Social and Governance Risks Are Financial Risks
Ultimately, we believe that investors who are unaware of ESG and do not integrate ESG into their investment processes may be exposing themselves to additional, unnecessary and possibly unrewarded risks.
Fed Will All But Guarantee Negative Real Yields
Anyone still expecting the fixed interest payments from Treasuries, or even high-quality corporate bonds, to outpace inflation in the coming years is just setting themselves up for disappointment.
Home Ownership Rate: At 65.8% in Q2
Over the last decade, the general trend has been consistent: The rate of home ownership continues to struggle. The Census Bureau has now released its latest quarterly report with data through Q2.
S&P/Case-Shiller Home Price Index: May Update
With today's release of the May S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.04% month over month which is cut to -0.22% with inflation adjustment.
Working From Home Is Terrible News for Landlords
Once we get the pandemic under control, working from home will be welcomed by cost-cutting companies and staff who dread the daily commute. But for the owners of commercial property the consequences may be severe.
ESG Funds Are Where The Profits Are During The Pandemic
A large iShares ETF investing in companies with positive ESG characteristics has produced a total return this year more than three times the performance of the S&P 500.
Fortuna Redux - Strategic Income Outlook July 2020
Markets rebounded during the second quarter, aided by monumental support from the Fed. We expect the economy to continue improving, but given the recent wave of Covid cases we also expect some bumps along the way.
Is 9 Times More Yield Enough for You?
Does 9 times higher yield in EM than in US bonds make for an attractive investment proposition? We lay out the arguments.
The Bottom Fell Out
Right now, it looks like the US economy shrank at a 35% annual rate in Q2. To put that in perspective, the worst quarter we've ever had since the military wind-down immediately following World War II was -10% in the first quarter of 1958, when, not by coincidence, the US was hit by an Asian flu. This is going to shatter that record by multiples and will likely be the worst since the Great Depression.
Rob Arnott Says It’s ‘Insanely Stupid’ to Chase Market Bubbles
Rob Arnott has a warning for everyone who is confident they’ll know when it’s time to sell a soaring stock like Amazon.com Inc. or Tesla Inc.
The Need for Automation in ESG Investing
The key to successful ESG investing lies in the finer points of process automation.
Weekly Investment Strategy
The Bizarre Math Behind Tesla’s Valuation
Tesla’s market capitalization just crossed $300 billion. It’s the largest car maker in the world. Tesla’s market cap implies that its production will go up from the 400,000 cars a year it produces today...
Three Reasons to Own Individual Stocks in an Efficient Market
I’ve long been a believer that markets are generally efficient (for large cap stocks in the U.S, at least). As such, I’m always skeptical of advisors that peddle their ability to select individual stocks that they claim will beat the market over the long term.
I Believe Gold and Silver Are Just Getting Started
We all know that past performance is no guarantee of future results, but you can see in the chart below that the white metal could possibly be setting up for another epic run-up. At this stage of the bull market, silver’s current price appreciation is ahead of any previous rally.
How to Aid States, China Recovers from COVID-19, Mortgage Rates Falling Slowly
The U.S. and EU deliberate how to disburse aid, China’s recovery carries risks, and U.S. mortgage rates find a floor.
Valuation Inflation
We’ll start with a dozen or so charts showing the market is either very highly valued, or extremely overvalued, or merely stretched. But in general, you will see markets are indeed at the upper end of historical valuations. Then we’ll consider some reasons why this is so, and why stocks could even go higher.
Are Emerging-Market Bonds Worth the Risk?
Investors must balance ongoing risks of the coronavirus against the extra yield the bonds provide.
EU Recovery Fund: No Gamechanger but a Clear Positive
After four days of intense negotiations, EU leaders have reached agreement on a €750 billion recovery fund to help repair the economic damage from COVID-19. It took several concessions to EU creditor countries to break the deadlock. As expected, total grants in the deal have been reduced to €390 billion from an original €500 billion proposal.
Gold Is Within Striking Distance of Its All-Time High. Here's How to Play the Rally
Both gold and silver have been on a tear this week, with the yellow metal touching a nine-year high of $1,897 in intraday trading on Thursday. Silver was trading above $22.70, up 94 percent from its 52-week low on March 18.
New Home Sales Up 13.8% in June, Beats Forecast
This morning's release of the June New Home Sales from the Census Bureau came in at 776K, up 13.8% month-over-month from a revised 682K in May.
Europe’s Labor Measures: Short-term Gain, Long-term Pain?
European measures applied to mitigate the effects of the pandemic have contained the unemployment rate in Europe more than in the U.S. While recognizing economic risks from the rising number of COVID-19 cases in the U.S., our forecast sees this success ratio reversing before the end of the year.
Income Assets Are Down but Not Out
Higher-income assets underperformed in the second-quarter rebound. But that also means there’s pent-up potential in income-generating assets that may begin to show in later stages of the recovery.
Kansas City Fed Survey: Continued Growth in July
The latest index came in at 3, up 2 from last month's 1, which indicates expansion in July. The future outlook increased from 9 last month to 14. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.
Preschooler Parents Face the Toughest Choice as Offices Reopen
Parents are now uncomfortable sending their kids to child-care centers. Meanwhile, the U.S. child-care industry is in trouble.
The Imprint of Monetary Policy on Munis
Municipal bond investors will need to contend with the impact of monetary policy on market prices.
Testing the Recovery: A New Franklin Templeton–Gallup Project
The unprecedented nature of the COVID-19 economic disruption has made traditional gauges of economic developments woefully inadequate, says our Fixed Income CIO Sonal Desai. She highlights the need to look deeper into new ways of examining the path toward recovery...
Does the U.S. Presidential Election Pose a Risk to Markets?
With less than four months to go until Americans cast their votes for president, we’ve fielded an increase in questions from clients as to whether the U.S. presidential election poses a risk to markets and the economy. The short answer is yes.
Conference Board Leading Economic Index Increased in June
The latest Conference Board Leading Economic Index (LEI) for June was up 2.0% from the May final figure of 100.0.
Active ETF Launches Are Outstripping Passive for First Time
The debuts of actively managed ETFs are outnumbering those of traditional funds at a record pace as issuers bet on investor demand for stock picking.
Thematic Investing & the Stay-at-Home Economy
Widespread efforts to contain COVID-19, including closures of businesses, schools, and offices, has upended many aspects of our everyday lives. In this webinar, Global X’s thematic research team looks at how long-standing habits have quickly changed amid this disruptive environment and what it may mean for certain industries and themes going forward, including Video Games & E-sports, Robotics & AI, Cloud Computing, E-commerce.
Webinar attendees will:
Jay Jacobs, Pedro Palandrani, and Andrew Little will be available to answer your questions following the presentation.
Existing-Home Sales Climb in June
This morning's release of the June Existing-Home Sales showed that sales rose to a seasonally adjusted annual rate of 4.72 million units from the previous month's 3.91 million. The Investing.com consensus was for 4.78 million. The latest number represents a 20.7% increase from the previous month, it's largest monthly increase ever, and a 11.3% increase year-over-year.
Another Ride on the Roller Coaster?
A point we have increasingly been making is the self-mitigating nature of: (1) market returns and (2) capital market assumptions (“CMAs”). There is a demonstrable pattern of CMAs coming down after significant rallies in equity markets and going up after a decline.
FHFA House Price Index: Down 0.3% in May
The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for May. U.S. house prices were down 0.3 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 4.9% (nonseasonally adjusted). After adjusting for inflation and seasonality, the index is down 0.08% in May and up 5.85% year-over-year (seasonally adjusted).
Is It My Job to Save a Client from Himself?
I have a client who is struggling with whether or not to retire. He is wondering if he is making a difference in his work or if he should just quit and, “do something good.” But it would be a bad financial decision.
Bank Loans: Three Questions on What’s Changed Since the March Madness
In March, Bank Loans Portfolio Manager John Bell saw three different roads back to par, with market recovery in 6-12 months the most likely. How has the recent market activity changed his view?
Seniors Ponder Whether Long-Term Care Is Too Risky in Covid Era
Millions of Americans who bought insurance to help them pay for nursing or home-health care are now facing a tough call.
Covid Antibodies Fade Rapidly, Raising Risk of Lost Immunity
Recovering from Covid-19 may not offer much lasting protection from future infections for those with only mild cases, says the New England Journal of Medicine.
What a Difference a Quarter Makes
First quarter 2020 saw the U.S. economy in a tailspin; second quarter pulled out of it … but now is the recovery stalling?
2020 Midyear Outlook – Dog Years of Investing
Markets thus far in 2020 have been, to use an overused word, unprecedented. In a matter of months, we have witnessed economic and market moves that typically take an entire market cycle of many years to unfold. So, we truly do see 2020 as a year when investors are gaining “dog years” of experience.