Market Perspectives

After beginning the quarter on a relatively upbeat note, familiar themes returned as fears of inflation, ambiguity over the end of the pandemic, and uncertainty about the future of Chinese capitalism raised concerns for investors. Markets vacillated between these concerns and cautious optimism for economic growth emerging from the pandemic. As a result, many markets ended the q ...

As the global economy continued to reopen and the recovery gained speed, markets reached new highs. Inflation rose significantly, but prospects dimmed for a sizable infrastructure bill. Thus, some major trends from the first quarter reversed: bond yields fell and value stocks underperformed as the Fed tried to rein in inflation expectations. Despite some mixed signals from the ...

Despite extensive economic and human costs, 2020 may be a turning point in multiple ways. The speed of the U.S. economic recovery indicates that the U.S. economy is far more resilient than previously acknowledged. The rapid development of a coronavirus vaccine showcased the astonishing capabilities of modern biotechnology firms financed by governments and capital markets. In addition, this year’s innovations in fiscal and monetary policy might become a new standard. Much hinges on whether the Biden administration can implement its agenda of accommodative fiscal policy and strict climate change regulations...

Despite extensive economic and human costs, 2020 may be a turning point in multiple ways. The speed of the U.S. economic recovery indicates that the U.S. economy is far more resilient than previously acknowledged. The rapid development of a coronavirus vaccine showcased the astonishing capabilities of modern biotechnology firms financed by governments and capital markets. In addition, this year’s innovations in fiscal and monetary policy might become a new standard. Much hinges on whether the Biden administration can implement its agenda of accommodative fiscal policy and strict climate change regulations...

Propelled by large cap growth stocks, the S&P 500 reached an all-time high on September 2.  New economic data exceeded expectations, and COVID-19 cases were falling in the U.S. Yet stocks soon declined, driven by a correction in large cap tech stocks.  Equities still closed the quarter in positive territory, with the S&P returning 9% this quarter and 6% year-to-date.  H ...

Following the March downturn, the quarter featured an exceptionally fast rebound in stocks. The S&P 500 posted returns of 21%, and the NASDAQ climbed 31% this quarter. Stock prices closed the quarter close to January levels, with the S&P 500 down 3% and the NASDAQ up 13% year-to-date. The rebound occurred while the U.S. economy operated at limited capacity with many sec ...

On January 1st, China informed the American government that a new pathogen, soon to be called the coronavirus, had been discovered in Wuhan, China. Its toxicity and infection rates were still unknown but soon proved to be far more virulent than many prior viruses.  There was no medical cure.  Epidemiologists warned that a global pandemic could result.  The contagion in China so ...

Investing is often confused with trading.  Good long-term investing is not for the faint of heart.  Longer-term political, economic, and capital market trends, rather than short-term portfolio positioning requiring the need for an accurate forecast, is often the most reliable route for investors.  Important secular trends include the continuing democratization of stock market investing, with zero online trading fees and fractional shares.  The combination of a robust U.S. economy, a thoughtful Federal Reserve...

It has been a good year for U.S. investors.  The global economic slowdown and geopolitical turmoil created a nearly irreversible thirst for super safe assets as reflected by the Barclays AGG bond index gaining 8.5%.  At the same time, the health of the U.S. economy produced robust gains in equities, with the S&P 500 index up 21%.  Happy surprises included long-term Treasuri ...

The quarter was a good one for investors, overcoming fears of an all-out U.S.-China trade war.  The S&P 500 index rose roughly 4% for the quarter and was up 17% for the year.  It was the market’s best first half performance since 1997 and extended the more than decade long bull market.  But it wasn’t until April this year that the S&P 500 climbed back to its October 201 ...