The Market in Pictures, December 27

Our team looks at a lot of research throughout each day. A few charts that caught our eye this week, and the way they fit the unfolding puzzle of evidence:

Beckham: Inflation has made it back to the general range accepted by most central bankers

Data as of November 2024

John Luke: though long-term and short-term rates have significantly diverged since the FOMC decided to start cutting rates

Source: Strategas as of 12.20.2024

John Luke: and consumer outlooks for inflation are far from settled

Data as of 12.23.2024

Brett: There’s always something for investors to fear, though it changes over time and is usually not the resulting market catalyst (see 2023 “hard landing”

Data as of 12.17.2024

Joseph: and market “rules” often break (see inverted yield curve -> hard landing)

Brett: Popularly quoted indicators are often not only wrong but often based on stories not data

Brad: and the supposedly tight connection between the Fed balance sheet and equity performance

John Luke: Contrary to popular belief, big up years for stocks (like 2023/2024) occur more often than even small down years

Brian: shown another way, many miss the (positive) right tails by worrying too much about the (negative) left tails

Arch: But here we are, with strategists regularly taking the safe formula of (Current price + 5 to 10%)

Data as of November 2024

JD: and after last year’s overly conservative outlooks, they’re ratcheting back to the old formula

Brad: Emerging markets have been the ugly duckling of portfolios in recent years

Brad: Emerging markets have been the ugly duckling of portfolios in recent years

Dave: and like most equity diversifiers, completely stomped by the superior profitability of megacap US tech companies

Brad: The handful of stocks that change lives are much more obvious in the rearview mirror than they were through the windshield

Data as of November 2024

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