Previously in the Market
May 2023: Confidence Game
“It's better to look ahead and prepare, than to look back and regret.”
– Jackie Joyner-Kersee
Markets are in confidence limbo, torn between peak rate hopes and recession fears. Resilient earnings, stabilizing yields and cautious investor positioning are reassuring and supportive of the near-term set up. However, the growth outlook remains uncertain given the tighter liquidity backdrop and nagging uncertainty surrounding the debt ceiling. How will the confidence game play out?
June 2023: More Participation, Less Agitation
“Yesterday is gone. Tomorrow has not yet come. We have only today. Let us begin.”
– Mother Teresa
Markets have been resilient, overcoming plenty of macro volatility with encouraging price gains. However, they are historically narrow with the proportion of returns attributable to the largest five stocks greater than any other year over the last two decades. We suspect more participation would lower investor anxiety. Will the market broaden out?
July 2023: Resilient Economy, Nervous Markets: Rounding the Bend
“Well done is better than well said.”
– Benjamin Franklin
The market advance extended into the halfway point of the year with resilient economic growth, and we suspect a healthy dose of FOMO (fear of missing out), leaving the frustrated bears in the dust. The worry list remains long, justifiably so. However, if the last six months taught investors anything, it’s that the less discussed optimistic scenarios should not be overly discounted. Good first halves tend to be accompanied by further gains. Can the re-rating continue?
August 2023: Summertime Grind?
“Don't count the days, make the days count.”
– Muhammad Ali
Markets continued their push higher last month, buoyed by an accelerating economy, decent earnings results and, we suspect, FOMO (fear of missing out) buying by reluctant bears. Soft landing optimism has increased, and with it, bond yields. The bar for further outperformance has increased, raising consolidation odds, but we remain encouraged by our supporting analytics. Will a summertime grind alter the market’s long-term trajectory?
September 2023: The Choppy Path: When Good Is Bad
“Great things are done by a series of small things brought together.”
– Vincent Van Gough
A resilient US economy is challenging the disinflation narrative, pushing bond yields higher and catalyzing a choppy trading backdrop. While higher oil prices and US dollar, as well as challenging seasonals, have raised consolidation odds, we remain encouraged by the balance of our analytics. How will this “good news is bad news” backdrop play out?