December 11, 2024: Bad News Is Good News
Last week’s economic reports provided further evidence that the U.S. job market is slowing. Despite headline growth of 227,000 jobs in November, a higher unemployment rate and lengthening duration of
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December 4, 2024: Rising Tide Is Lifting All Boats
U.S. stocks have delivered strong returns over the past month, with the stocks in the Russell 3000 Index posting an average gain of 9.87%.1 Robust corporate earnings, supported by a
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November 20, 2024: Are Tariffs Really Inflationary?
Since the election, many have assumed higher tariffs will lead to higher inflation. However, a closer look reveals this may not be the case. During the 2018 trade war, PCE
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November 6, 2024: A Cooling Market for U.S. Workers
After two light weeks of economic news, last week brought a surfeit of economic data releases and corporate earnings reports. Among the former, investors received two reports on the U.S.
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October 30, 2024: Stock Market Stability Belies Bond Market Volatility
As the stock market continues to notch new highs, underlying uncertainty may go unnoticed. While the stock market projects calm, increased volatility is clearly visible in the bond market. You
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October 23, 2024: The Federal Reserve Cuts Rates—And Rates Go Up
For much of 2024, many homeowners held hopes to refinance their 7-8% mortgages into lower-interest loans as interest rates fell. Those hopes likely grew later in the summer as the
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October 9, 2024: Will the Small Fish Catch Up to the Big Whales?
2024 is set to mark the fourth consecutive year of small-cap stock returns lagging large-cap stock returns. But optimism has surfaced on the horizon. Analyst forecasts point to parity in
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October 2, 2024: How Restrictive Are Interest Rates?
Long awaited stimulative actions from the Chinese government captivated investor attention last week. Whether these actions deliver their intended jolt to China’s economy remains to be seen. Indisputable, however, was
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September 25, 2024: Another Atypical Rate-Cut Cycle
Periods in which the Federal Reserve lowers interest rates have typically been positive for equities. Moreover, defensive stocks, such as those found in the consumer-staples sector, have tended to outperform
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September 18, 2024: The Descent Is the Hardest Part
This week the Federal Reserve will almost certainly join other major central banks in easing monetary policy. It has been a long time coming. The Federal Funds target rate reached
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September 11, 2024: An Unpleasant, Yet Ordinary, Week in the Stock Market
For investors in U.S. stocks, last week’s 4.2% decline, as measured by the S&P 500 Index, was unpleasant but certainly not unique. In fact, declines of that size occur regularly
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August 28, 2024: Rate Cuts Are Coming… But How Many?
Last Friday in Jackson Hole, Federal Reserve Chair Jerome Powell made clear that the Federal Reserve will move its target interest rate lower next month. This move will come after
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August 21, 2024: A Bad Dream, or More to Come?
The market’s recent days of volatility might feel today like the distant past. Last week, the S&P posted its strongest weekly performance since last November, pushing the index higher and
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August 14, 2024: Return to Normal: Negative Stock-Bond Correlations
We have seen a notable shift in stock-bond correlations this year as inflation declines. Historically, high inflation leads to positive correlations, meaning stocks and bonds move in the same direction,
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August 8, 2024: Volatility Awakens from Its Slumbers
This Monday’s trading day offered two historic market moves. The 12%, single-day drop in Japan’s Nikkei stock-market index was the largest decline in that index since 1987. Domestically, the so-called
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July 31, 2024: A Welcome Rally in Beleaguered Stocks
A rotation out of the crowded AI trade has benefited beleaguered small cap and value stocks. A historically narrow market, led by a handful of large tech companies, left many
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July 24, 2024: Stay Focused on Earnings
Last week’s economic releases delivered a mixed picture. On the one hand, a better-than-expected retail sales report signaled that consumer spending continues to expand—at a slower rate than last year,
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July 17, 2024: The Economy Cools & Earnings Estimates Warm Up
The flurry of earnings reports is about to begin, and the primary question for investors this season is how the gap between weakening macroeconomic data will reconcile with optimistic, bottom-up
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July 10, 2024: Why Interest Rate Cuts Are Becoming More Likely
The Fourth of July holiday may have shortened last week’s trading schedule, but the holiday could not keep investors from growing increasingly focused on the probability of interest rate cuts
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June 26, 2024: How Nvidia Became “The Most Important Stock in the World”
Since the beginning of May, Nvidia’s stock has appreciated 42%. Such a two-month move in a stock is not in itself unusual. However, this level of stock appreciation is unusual
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June 19, 2024: Positive News on the Inflation Front
A few months ago, an unorthodox economic theory began to gather attention. Rather than constraining economic activity, could higher interest rates instead be stimulating it? The question seemed timely. Despite
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June 12, 2024: Understanding Inflation Measures
When interpreting this week’s CPI report, it is important to note that inflation measures are not created equal. The Consumer Price Index (CPI) is based on a fixed basket
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June 5, 2024: The Fed Model: A Questionable Timing Tool
For much of the past 15 years, low bond yields have helped push up stock prices as investors found few alternatives to stocks in attempting to reach their return objectives.
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May 22, 2024: Opportunities in Artificial Intelligence
With Memorial Day weekend and a quiet week of economic news ahead, the market is laser-focused on this week’s earnings report from NDIVIA, considered by many to be the bellwether
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May 15, 2024: Why Are Consumers Pessimistic?
Last week’s consumer sentiment report from the University of Michigan reaffirmed that consumers are feeling increasingly negative about the economy. These negative sentiments persist despite jobs growing at an average
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May 8, 2024: A Strong Start to the Year in Corporate Earnings
High interest rates, global conflict, problems in commercial real estate—despite these ongoing concerns, the U.S. corporate juggernaut carries forward. Through Monday, over 85% of companies in the S&P 500 Index
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May 1, 2024: Why Budget Deficits Matter
This week, investors will digest a litany of economic data, including updates on the U.S. job market and on manufacturing and service activity. These releases come amid a busy week
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