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:
Brett: Core Personal Consumption Expenditures (PCE) is said to be the Fed’s favorite indicator, and it’s getting into their target range
Data as of 01.25.2024
John Luke: that said, markets are actually expecting one fewer rate cut than they were two weeks ago
Data as of 01.22.2024
John Luke: and Fed speakers seem reluctant to embrace market expectations of significant rate cuts
Data as of 01.19.2024
Dave: It’s generally accepted that the FOMC prefers to avoid being seen as political, but election years haven’t impacted their activity in the past
Source: Morgan Stanley as of 01.24.2024
Brian: That said, no matter what they do there will be plenty of people accusing them of taking sides
Source: Aptus as of 01.22.2024
Beckham: Making the Fed’s job trickier is the evidence that maybe the slowest economic conditions have already occurred
Source: @LizAnnSonders as of 01.22.2024
John Luke: as US consumers in general are sitting with very strong balance sheets
Data as of December 2023
Brian: While the cost of mortgages relative to actual mortgage-backed bonds remains well above historic norms
Source: Aptus as of 01.24.2024
John Luke: corporate credit spreads are as low as they’ve been in years
Source: State Street as of 12.31.2023
Joseph: leading corporations to issue debt at favorable levels
Source: Financial Times as of 01.18.2024
Dave: While the semiconductor industry has been eating its way into larger space in the S&P 500
Source: Strategas as of 01.22.2024
Brad: the broader universe of stocks has had underwhelming performance since the peak in late 2021
Source: Strategas as of 01.23.2024
Brad: and value stocks also coming out of a year of extreme underperformance
Data as of January 2023
John Luke: US dominance over foreign markets has been quite dramatic in recent years
Brett: but these performance cycles have often been long in nature
Source: Bank of America
Brad: As tired as we all are of talking about the Mag 7, it’s important to recognize that markets aren’t crazy; their businesses are performing better than most
Brian: and if you’re really worried about their impact, it’s as cheap as it’s ever been to buy hedges on the S&P 500
Source: Aptus as of 01.24.2024
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Past performance is not indicative of future results. This material is not financial advice or an offer to sell any product. The information contained herein should not be considered a recommendation to purchase or sell any particular security. Forward-looking statements cannot be guaranteed.
Projections or other forward-looking statements regarding future financial performance of markets are only predictions and actual events or results may differ materially.
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