Risk levels are the highest in 140 years, are you prepared to Navigate What’s Next?
For Illustrative Purposes Only As of May 2021 the S&P 500 price is 169% above its historical trend line, this is the highest level in 140 years. Last time prices were at a historic high was the dot com crash in 2000 (123% above trend). Every time market prices have risen greater than 44% above the trend, the S&P 500 […]
Bear Market Road Map: What Happens Next
What Happens Next? Analysts, commentators, and managers are all taking turns making predictions about where financial markets will bottom. While modern markets have never faced a global health pandemic with the magnitude of COVID-19, history is filled with examples of unexpected headlines and “Black Swan” events that take analysts and investors by surprise. In fact, that’s how most Bear markets […]
Could a Fed Rate Cut Be Bearish?
The next Federal Reserve Open Market Committee meeting is set for June 19, 2019. Based on the Bloomberg World Interest Rate Probability screen (WIRP), markets are pricing in a 20% chance for a rate cut next week, an 84% chance in July, and a more than 94% chance of a rate cut in September. Bloomberg WIRP as of 6.12.2019 Beware […]
Peak Corporate Profits
The current rally that began in Q4 2016 has been fueled by earnings growth. Out of the eleven sectors that make up the S&P 500 index, Technology has been the standout momentum leader delivering nearly double the return of the broader S&P since the rally began. With 492 out of 500 S&P 500 companies reporting, first quarter 2019 earnings season […]
What’s Next for Equities
Let’s Go Streaking. Let’s go all the way back to January when markets started off 2017 with a heavy dose of what we would describe as “Cautious Optimism“. Cautious about a new administration and untested leader in President Trump, but optimistic about a business friendly agenda in tax reform and healthcare. In February we published a research post highlighting rare […]
What the Fed is Watching
(See Beware The Ides of March) While we pay close attention to WIRP, it’s not the only data point pointing towards higher interest rates. Strong Data Just about every Federal Reserve comment, whether written or spoken by a Federal Reserve Bank member, states that future decisions are “data dependent”. Taking them at their word, we see across the board that recent economic […]