This is the second-longest period between the Fed's last rate hike and the first cut (146 days). However, the return during the current pause has been the strongest. Going back to 1995, Consumer Staples, Health Care, and Utilities have been the strongest performing sectors after the first Fed rate cut in a series. The real 10-year Treasury yield and the real Fed Funds rate are approaching levels that preceded recessions and would be considered “tight.” The price of gold has risen 35% in… View More
Friday’s employment report suggests the US economy may be slowing down faster than most investors think. Nonfarm payrolls increased by 142,000 in August, but revisions to June and July brought the net gain down to a modest 56,000. And the details were worse. We like to follow payrolls excluding three sectors: government, education & health services, and leisure & hospitality, all of which are heavily influenced by government spending and regulation (including COVID lockdowns and reope… View More
Stocks put in a mixed performance last week as the S&P 500 increased (0.27%) but the NASDAQ fell (-0.91%). Treasuries were weaker with the yield curve steepening. Discussion revolved around AI (especially Nvidia’s earnings) and the Fed’s attempt at a soft landing. Best sectors were financials (+2.95%) and industrials (+1.71%); worst sectors were technology (-1.47%) and communication services (-0.69%). U.S. Q2 GDP growth was unexpectedly revised up to 3.0% from 2.8%. All the focus… View More
Stocks were higher last week (S&P 500 +1.47%) as all major averages gained. Most averages remained below the July all-time high. The big focus was on the Fed and Chairman Powell’s strong endorsement of lower rates. Best sectors were real estate (+3.68%), materials (+2.39%), and consumer discretionary (+2.10%); worst sectors were energy (-0.28%), technology (+1.08%), and communication services (+1.20%). Chairman Powell stated clearly,"... the balance of risks to our two mandates has … View More
Our research provider follows inflation, which affects us every day. The Strategas Common Man CPI is comprised of items people must buy each day, week, or month – food, energy, shelter, children’s clothing, utilities, and insurance. Real wages may have started to improve recently, but the cumulative effects of inflation indicate that the “common man’s” standard of living has deteriorated in the last four years. January 2021 January 2017 Source: Strategas Chart ref… View More