Tag: Dow Jones Industrial Average

Treasury market returns are negative again. Why this time for bonds looks different than 2022.

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Yearly returns in the Treasury market slipped into negative territory this week as the market sold off on signs that the Federal Reserve may need to keep rates high for a while to contain inflation.

While negative returns might stir bad memories of last year’s shocking losses for bonds, stocks and nearly everything else, investors holding Treasury debt issued at 2023’s higher yields might want to sit back and take stock.

“This is the top thing we hear,” said Ryan Murphy, director of fixed-income business development at Capital Group, of evaporating returns in what’s been a tough August. “You saw the worst bond market in 40 years last year. Investors, they are tired, and feel beaten up.”

Murphy’s message to clients is this: “In bonds, you earn the money over time.” And those dwindling bond returns since January? “Approach it with a deep breath, and know this is going to work out in the end.”

Capital Group’s laid-back style and lack of “a star CEO” earned it recognition by Institutional Investor in March as “a new bond leader” without a king, in large part because it attracted $100 billion in funds over the past five years, or twice the total of its peers.

Recent volatility in interest rates again zapped yearly gains in many bond funds, as Fed officials continued to warn that a roaring labor market and robust spending could keep inflation from receding to the central bank’s 2% annual target.

The spike in long-term bond yields makes older, lower-yielding securities look comparatively less attractive. That’s reflected in the yearly return on a key Bloomberg U.S. government bond and note index, which turned negative for the first time since March (see chart), when several regional banks failed, stoking fears of a broader banking crisis.

Returns on U.S. government bonds turn negative for the year.

FactSet

However, a look back at August 2022 shows the 10-year Treasury yield starting around 2.6%, according to FactSet.

By contrast, Treasury bill yields
BX:TMUBMUSD06M
neared 5.5% on Thursday, or “north of anything we’ve seen over the past 15 years,” Murphy said. And for investors looking to lock in longer-term yields, the 10-year Treasury rate
BX:TMUBMUSD10Y
touched 4.307% on Thursday, its highest level since November 2007, according to Dow Jones Market Data.

See: How BlackRock’s Rick Rieder is steering his active fixed-income ETF as bond funds struggle

“It’s becoming more expensive for the government and companies to finance debt because of the rapid climb in rates,” Murphy said of the drag of higher long-term interest rates.

On the flip side, it’s also been one of the best stretches for lenders and bond investors in terms of getting paid to act as creditors since the 2007-2008 global financial crisis, but without a U.S. recession — or at least not yet.

What’s also different from last year is that the Fed already jacked up interest rates to a 22-year high of 5.25%-5.5% in July, and has signaled it’s likely nearly finished with hikes in this cycle.

Record cash on the sidelines

Murphy pointed to a mountain of cash on the sidelines, in the form of assets in money-market funds, as another potential stabilizer for markets.

Assets in money-market funds hit a record $5.57 trillion for the week ending Wednesday, according to data from the Investment Company Institute.

“What’s really interesting is that there’s been two bursts of investors going into money-market funds. There was a big shift right at the onset of COVID, and another burst over the past 12-18 months since the beginning of the rate-hiking cycle,” Murphy said.

Looking back to 2008, he pointed to a similar buildup in money-market assets, and a roughly $1.1 trillion wall of cash subsequently leaving the sector, as financial assets began to recover in the wake of the financial crisis.

“What we did see, while not all of it, was a healthy amount went back into fixed-income in the following years,” Murphy said.

Stocks closed lower Thursday and were headed for another week of losses, with the Dow Jones Industrial Average
DJIA
2.3% lower on the week so far, the S&P 500 index
SPX
down 2.1% and the Nasdaq Composite Index off 2.4%, according to FactSet.

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August 17, 2023
Nasdaq falls to 6-week low as rising bond yields weigh on ‘Magnificent 7’ stocks
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U.S. stocks traded lower for a third straight day on Thursday as rising bond yields spurred weakness in some of the so-called Magnificent Seven megacap stocks, helping to drive the Nasdaq to a six-week low.

How are stocks trading
- The S&P 500
  SPX
  was down 2 points, or 0.1%, to 4,401.
- The Dow Jones Industrial Average
  DJIA
  shed 42 points, or 0.1%, to 34,725.
- The Nasdaq Composite
  COMP
  fell by 46 points, or 0.3%, to 13,428.
The Dow and S&P 500 were on track to extend a losing streak to a third straight session as major indexes headed for another week in the red. The S&P 500 hasn’t fallen for three weeks in a row since February, FactSet data show.
What’s driving markets

Bonds have resumed command of the stock market of late as higher yields lash shares of megacap technology stocks, undermining their status as the undisputed market leaders.

Long-dated Treasury yields continued to rise Thursday, with the 10-year yield
BX:TMUBMUSD10Y
touching its highest level since the 2008 financial crisis, rising north of 4.31%. Bond yields move inversely to prices.

Rising yields helped heap more pressure on shares of some of this year’s highflying tech stocks, including Tesla Inc.
TSLA,
-0.34%,
Apple Inc.
AAPL,
-0.91%
and Microsoft Corp.
MSFT,
-0.01%

The elite group of megacap tech stocks which also includes Amazon.com Inc., Meta Platforms Corp.
META,
-0.24%
and Alphabet Inc.’s Class A
GOOGL,
+2.42%
and Class C
GOOG,
+2.48%
shares has been credited with driving much of the Nasdaq Composite’s nearly 30% run-up year-to-date. But their market dominance has faded in recent weeks as investors have favored other cyclical sectors like energy and materials stocks. Those two sectors were the best performers on the S&P 500 on Thursday.

“That’s a theme that’s been bubbling up here over the last three to four weeks, but there’s more of an exclamation point on it now,” said David Keller, chief market strategist at Stockcharts.com, during a phone interview with MarketWatch.

“First you had Microsoft and Apple breaking down a few weeks ago, now you’re getting Meta breaking below its 50-day moving average.”

Keller added that rising bond yields tend to have a bigger impact on growth stocks like technology names, while sectors like energy are more resilient.

“Energy can do just fine in a rising rate environment. energy and materials should probably do better in a relative basis,” he said.

Minutes from the Federal Reserve’s July meeting released Wednesday afternoon were being blamed for the latest leg higher in global bond yields. They showed that Fed policy makers could continue raising interest rates amid concerns that inflation could reaccelerate, potentially pushing bond yields even higher.

“It’s really uncertain where terminal interest rates will land given the economy isn’t giving us a decisive picture of being too strong or too weak. It’s keeping the window open for more rate hikes potentially,” said Mohannad Aama, a portfolio manager at Beam Capital Management, during a phone interview with MarketWatch.

Corporate earnings were also in focus as investors received results from Cisco Systems
CSCO,
+4.06%
and retail giant Walmart Inc.
WMT,
-1.74%.
Cisco reported strong quarterly results after Wednesday’s close. Walmart also reported stronger than expected earnings, helping to offset some concerns about the strength of the consumer spurred by Target Corp.’s
TGT,
+1.94%
lackluster earnings and guidance from Wednesday.

Shares of Cisco rose 2.6%, while Walmart shares turned lower, down 1.2%.

Economic updates released Thursday helped support the notion that the U.S. economy is growing at a faster pace than economists had expected, potentially complicating the Fed’s efforts to tamp down inflation.

First-time jobless-benefit claims fell by 11,000 to 239,000 last week, a sign that layoffs in the U.S. labor market remain low. The Philadelphia Fed factory index also shot higher to 12 in August, up from negative 13.5 during the prior month, a sign that manufacturers in the U.S. could be exiting a slump.

Companies in focus

Hawaiian Electric Industries Inc.
HE,
-15.24%
shares fell after The Wall Street Journal reported that the utility has engaged in talks with restructuring advisers to consider its next steps after the deadly Maui wildfires.

Shares of Ball Corp.
BALL,
+3.41%
rose 3% after agreeing to sell its aerospace unit to BAE Systems for $5.5 billion.

Chesapeake Energy Corp.
CHK,
+6.03%
will replace Mercury Systems Inc.
MRCY,
+2.99%
on the S&P MidCap 400, S&P Dow Jones Indices said on Wednesday. Shares of Chesapeake were up 6%.

Shares of Cigna Group
CI,
-7.10%
and CVS Health
CVS,
-8.89%
dropped following a report that a major nonprofit health insurer was preparing to shun the pharmacy-benefit industry.
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August 17, 2023
Stocks post back-to-back loss after Fed minutes point to lingering inflation and rate risks

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U.S. stocks posted back-to-back losses Wednesday after Federal Reserve minutes of its July meetings showed concerns about inflation revving back up. The Dow Jones Industrial Average DJIA fell about 180 points, or 0.5%, ending near 34,765, according to preliminary FactSet data. The S&P 500 index SPX gave up 0.8% and the Nasdaq Composite Index COMP closed 1.2% lower. All three benchmarks booked back-to-back loses, while the S&P 500 ending at its lowest level in more than a month. Minutes of the Fed’s July 25-26 meeting said “most participants continue to see significant upside risks to inflation, which could require further…

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August 16, 2023
CNBC Daily Open: More trouble ahead for U.S. banks

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Spencer Platt | Getty Images

This report is from today’s CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

Beset by worries
Major U.S. indexes tumbled, weighed down by losses in financial stocks and worries over China’s faltering economy. Asia-Pacific markets followed Wall Street and fell Wednesday. Most regional indexes lost at least 1%. A silver lining: Japanese business’ sentiment climbed in July, alongside the country’s stronger-than-expected economic growth.

Potential banking downgrade
Fitch Ratings warned it may downgrade the U.S. banking industry’s credit rating from AA- to A+. Since individual banks cannot be rated higher than the industry, major banks like JPMorgan Chase and Bank of America would be cut to an A+ rating — with a trickle-down effect for smaller banks — if the downgrades happens. Fitch’s warning comes as Moody’s downgraded 10 banks last week.

Higher risk of corporate defaults
There’s a higher chance corporate debt in emerging markets might default, according to JPMorgan. The bank raised its forecast for high-yield defaults in Asia from 4.1% to 10% — but that figure drops to just 1% if China property is excluded. That’s a sign of how severe the contagion risk is if Country Garden, the beleaguered Chinese property developer, defaults.

U.S. consumer strong as ever
U.S. consumer spending in July remained healthy, according to data from the Commerce Department. Seasonally adjusted retail sales rose 0.7% for the month; economists were expecting 0.4%. Excluding autos, sales rose 1% against a 0.4% forecast. Both figures were the best monthly gains since January, reinforcing sentiment that the consumer can continue supporting economic growth.

[PRO] Stocks are still ‘overvalued’
Despite the sell-off in stocks the last two weeks, U.S. markets have rallied so much this year that stocks are still “overvalued and overextended,” according to Morningstar’s chief U.S. market strategist. It’s a good time to sell these six stocks to lock in profits — and buy five cheap ones, he said.

The bottom line

Financial stocks had a bad day.

After Fitch warned that it might downgrade the banking industry’s credit rating, shares of big U.S. banks fell. Bank of America lost 3.2%, JPMorgan declined 2.55% and Wells Fargo slid 2.31%.

Regional banks weren’t spared the slaughter, either. The SPDR S&P Regional Banking ETF fell 3.33% after Minneapolis Federal Reserve President Neel Kashkari spoke in favor of “significantly further” capital requirements for banks with more than $100 billion in assets. Kashkari also emphasized that if inflation rebounds, rates might have to go higher and “pressures [in regional banks] could flare up again.”

But not everyone’s worried about Fitch’s warning. “The U.S. bank system is overall sound,” said Eric Diton, president and managing director at The Wealth Alliance.

“All Fitch was saying was: ‘If we did downgrade the sector again, that would lead us to have to downgrade a lot of the individual banks,’” Diton said. “Maybe they will, maybe they won’t.”

Banking doldrums aside, there were two bright spots in the initial public offering arena. Shares of VinFast, a Vietnamese electric vehicle company, surged from $10 per share to $22 in its debut on the Nasdaq; prices continued rising throughout the day to close at $37.

Meanwhile, Cava shares jumped 9.44% in extended trading after its first earnings report since its IPO in June. Taken together, they suggest that the IPO market is returning to health.

Still, major indexes couldn’t shrug off worries over banks and China. The S&P 500 slipped 1.16%, ending the day below its 50-day moving average for the first time since March — possibly heralding the start of a continued slide. The Dow Jones Industrial Average lost 1.02%, breaking its three-day winning streak. The Nasdaq Composite fell 1.14%.

If indexes continue sliding, that’d be their third consecutive losing week. Investors are hoping it’s a brief summer spell, a moment of correction that will end as the weather turns.

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August 15, 2023
CNBC Daily Open: More obstacles for U.S. banks

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A woman walks past JPMorgan Chase & Co’s international headquarters on Park Avenue in New York.

Andrew Burton | Reuters

This report is from today’s CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

Beset by worries
Major U.S. indexes tumbled, weighed down by losses in financial stocks and worries over China’s faltering economy. European markets mostly fell as well. The pan-European Stoxx 600 index lost 0.93%, but Italy’s FTSE MIB added 0.57% — the only major bourse to end the day in the green.

Potential banking downgrade
Fitch Ratings warned it may downgrade the U.S. banking industry’s credit rating from AA- to A+. Since individual banks cannot be rated higher than the industry, major banks like JPMorgan Chase and Bank of America would be cut to an A+ rating — with a trickle-down effect for smaller banks — if the downgrades happens. Fitch’s warning comes as Moody’s downgraded 10 banks last week.

U.S. consumer strong as ever
U.S. consumer spending in July remained healthy, according to data from the Commerce Department. Seasonally adjusted retail sales rose 0.7% for the month; economists were expecting 0.4%. Excluding autos, sales rose 1% against a 0.4% forecast. Both figures were the best monthly gains since January, reinforcing sentiment that the consumer can continue supporting economic growth.

Rate hike to strengthen ruble
Russia’s central bank jacked up interest rates by 3.5 percentage points to 12% at an emergency meeting Tuesday. The bank’s attempting to stop a sudden slide in the Russian ruble, which slumped to nearly 102 against the U.S. dollar Monday. The ruble has since climbed back to around 98.5 as of publication time.

[PRO] Overconfident investors
The stock market rally during the first half of this year has made investors overconfident, according to a Bank of America survey. That’s bad — because the “strong tailwind” propelling stocks forwards is fading fast, a BofA analyst wrote in a summary of the survey.

The bottom line

Financial stocks had a bad day.

After Fitch warned that it might downgrade the banking industry’s credit rating, shares of big U.S. banks fell. Bank of America lost 3.2%, JPMorgan declined 2.55% and Wells Fargo slid 2.31%.

Regional banks weren’t spared the slaughter, either. The SPDR S&P Regional Banking ETF fell 3.33% after Minneapolis Federal Reserve President Neel Kashkari spoke in favor of “significantly further” capital requirements for banks with more than $100 billion in assets. Kashkari also emphasized that if inflation rebounds, rates might have to go higher and “pressures [in regional banks] could flare up again.”

But not everyone’s worried about Fitch’s warning. “The U.S. bank system is overall sound,” said Eric Diton, president and managing director at The Wealth Alliance.

“All Fitch was saying was: ‘If we did downgrade the sector again, that would lead us to have to downgrade a lot of the individual banks,'” Diton said. “Maybe they will, maybe they won’t.”

Banking doldrums aside, there were two bright spots in the initial public offering arena. Shares of VinFast, a Vietnamese electric vehicle company, surged from $10 per share to $22 in its debut on the Nasdaq; prices continued rising throughout the day to close at $37.

Meanwhile, Cava shares jumped around 8% in extended trading after its first earnings report since its IPO in June. Taken together, they suggest that the IPO market is returning to health.

Still, major indexes couldn’t shrug off worries over banks and China. The S&P 500 slipped 1.16%, ending the day below its 50-day moving average for the first time since March — possibly heralding the start of a continued slide. The Dow Jones Industrial Average lost 1.02%, breaking its three-day winning streak. The Nasdaq Composite fell 1.14%.

If indexes continue sliding, that’d be their third consecutive losing week. Investors are hoping it’s a brief summer spell, a moment of correction that will end as the weather turns.

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August 15, 2023
S&P 500 ends at lowest level in a month as investors monitor signs of China’s weakening economy

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U.S. stocks closed sharply lower Tuesday as investors monitored signs of China’s darkening economic backdrop and gauged if a robust U.S. consumer could spell more Federal Reserve rate hikes. The Dow Jones Industrial Average DJIA fell about 360 points, or 1%, to about 34,946, according to preliminary FactSet data. The S&P 500 index SPX dropped 1.2% to about 4,437, its lowest close since mid-July, according to FactSet. The Nasdaq Composite Index COMP ended 1.1% lower. Chinese retail sales and industrial production in the world’s second biggest economy grew less than expected in July. Its growing property woes also contributed…

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August 15, 2023
‘Good news really is bad news’: Stocks hit a roadblock as strong retail sales reinforce soft-landing view

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Investors were jolted by a stronger-than-expected retail sales report on Tuesday, which underscores the dual-edged sword now facing markets.

July’s 0.7% surge in retail sales is helping to bolster the view that a resilient U.S. economy can avoid a recession, despite more than a year of rate hikes by the Federal Reserve. However, the data also serves as another piece of information that some policy makers can use to support even more hikes in the final four months of this year, and left the benchmark 10-year Treasury yield…

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August 15, 2023
CNBC Daily Open: Tech is back

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Nvidia headquarters in Santa Clara, California, US, on Monday, June 5, 2023.

Marlena Sloss | Bloomberg | Getty Images

This report is from today’s CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

Tech rebound
U.S. stocks started the week on a positive note, thanks to a rebound in chipmakers and technology stocks. European markets traded mixed. The regional Stoxx 600 index inched up 0.15%, buoyed by a 4.35% increase in Philips. However, the U.K.’s FTSE 100 slid 0.23% and Spain’s IBEX 35 dipped 0.05%.

Nvidia, again
Nvidia shares popped 7% to hit $437.43 after Morgan Stanley released a note reiterating the company’s strengths. “Nvidia remains our Top Pick, with a backdrop of the massive shift in spending towards AI, and a fairly exceptional supply demand imbalance that should persist for the next several quarters,” the bank wrote.

Back to golf, not banking
Goldman Sachs’ former CEO Lloyd Blankfein can’t imagine returning to his old firm, he told CNBC. Blankfein was disputing a New York Times article that “misquoted” him. “I never used the word ‘return’,” Blankfein said. “I think my days working 100-hour weeks are over.” He then ended the conversation and went back to his golf game.

The Russian ‘Goldilocks’ for China?
China’s been one of Russia’s staunchest supporters since Moscow’s unprovoked invasion of Ukraine. But analysts think China wants Russia in a “Goldilocks” situation: Neither so strong that it could challenge Beijing, nor too weak where it leaves China isolated against the West. Other observers, however, argue China’s already risking geopolitical capital to help Russia.

[PRO] Rate cuts next year?
Goldman Sachs thinks inflation will fall to a level that the Federal Reserve is comfortable with by the first half of next year. The Fed, in turn, will begin lowering interest rates before the end of June 2024, the bank forecast.

The bottom line

Technology stocks and chipmakers helped major U.S. indexes regain their footing after ending last week in the red. The S&P 500 gained 0.58%, the Dow Jones Industrial Average inched up 0.07% and the Nasdaq Composite advanced 1.05%.

While that’s just a single data point, yesterday’s positive market movement echoes Oppenheimer chief investment strategist John Stoltzfus’ argument that the last two week of losses didn’t signal the end of the bull market. Rather, it was “a pause that refreshes” — a healthy adjustment to “oversold market conditions,” Stoltzfus wrote.

Still, stocks face pressure from rising bond yields. The two-year U.S. Treasury yield is a hair’s breadth away from 5% while the 10-year yield is 4.2% — pretty healthy returns for a risk-free investment. “Fixed income just looks relatively attractive, especially [relative to] where [we] were just a couple of years ago,” said Kevin Gordon, senior investment strategist at Charles Schwab.

At the same time, higher yields mean lower prices. That “creates the opportunity to buy bonds at a real rate that we haven’t seen in well over a decade,” Ashish Shah, chief investment officer of public investing at Goldman Sachs Asset Management, told CNBC.

The tussle between stocks and bonds, however, seems a pretty good problem to have. Recent data show both inflation receding and the U.S. economy expanding more than forecast. Whatever choice investors make, then, it’s made under a backdrop of heathy conditions — something rare since the pandemic.

Or, as Adam Crisafulli, founder of market intelligence firm Vital Knowledge, put it, “We don’t think investors should dive too far down rabbit holes of despair.”

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August 14, 2023
Dow, S&P 500 and Nasdaq post gains as big tech stocks rebound

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U.S. stocks closed higher on Monday, with the Dow flipping positive near the closing bell, as technology stocks bounced back. The Dow Jones Industrial Average DJIA rose about 26 points, or 0.1%, ending near 35,308, according to preliminary FactSet data. The S&P 500 index SPX scored a 0.6% gain and the Nasdaq Composite Index COMP closed up 1.1%, booking its best daily percentage climb since July 28, according to FactSet data. The S&P 500’s information technology sector outperformed with a 1.9% gain, while the communication services segment rose 1%. The rally saw shares of Meta Platforms META, Apple Inc. AAPL, Alphabet…

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August 14, 2023
A stumbling stock market faces a crucial summer test. Here’s what will decide the bull’s fate.

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Call it the end-of-summer blues.

History shows that things can get ugly — and volatile — for the U.S. stock market in August and September. So a rocky start to the month shouldn’t be a big surprise. Indeed, even bulls might pine for some near-term consolidation after a torrid run that saw the S&P 500 index
SPX
rally nearly 20% over the first seven months of 2023. Through Friday’s close, the index is still up nearly 25% from its bear-market closing low of 3,577.03 hit on Oct. 12.

But what would send the 2023 rally decisively off the rails?

To answer that question, it helps to think about what has been driving the rally. Mark Hackett, chief of investment research at Nationwide, argues that the rally has largely been about fears that never materialized.

“I would say about 90% of the move that we’ve seen over the last 10 months has really been a walking back from the ledge of fear,” Hackett told MarketWatch, in a phone interview.

The October 2022 lows came as the Federal Reserve was hiking the fed-funds rate in outsize 75 basis point increments, inflation was just coming off its June peak last year above 9% and expectations for an imminent recession, or “hard landing,” were running hot.

Tom Essaye, founder of Sevens Report Research, contends the rally has been built on three pillars: The Fed is now seen by many investors as likely finished, or nearly finished, raising interest rates; the economy appears set to possibly avert a recession altogether, and inflation has remained largely on a downward path.

So trouble for the market would emerge if economic data were to falter and begin pointing to a hard landing, core inflation leveled off or bounced, or Fed Chair Jerome Powell signaled another rate hike is “definitely coming” and caused a further rise in Treasury yields.

“This scenario would essentially undermine the three pillars of the rally, and as such investors should expect a substantial decline in stocks, even considering the recent pullback,” Essaye said in a note last week. “In fact, a decline of much more than 10% would be likely in this scenario, as it would undermine most of the rationale for the gains in stocks since June (and perhaps all of 2023).”

That scenario has yet to materialize.

The year-over-year rate of inflation as measured by the U.S. consumer price index rose to 3.2% in July from 3% in June, data showed last week. But the core rate, which strips out food and energy, slowed to 4.7% from 4.8%. The July producer price index, a measure of costs at the wholesale level, came in a touch stronger than expected, but didn’t change investor expectations for the Federal Reserve to leave rates unchanged when policy makers next meet in September.

Policy makers will see another round of jobs data, including the August employment report, and inflation figures before that meeting.

Meanwhile, a jump in Treasury yields, with the rate on the 10-year note pushing back above 4.15% after hitting a 2023 high near 4.2% earlier this month, is getting much of the blame for continued softness in the stock market. Rising yields can make Treasurys look more attractive than other assets and also raise the cost of financing for companies.

The S&P 500 edged down 0.3% last week, suffering its first back-to-back weekly decline since May. The large-cap benchmark is down 2.7% so far in August, trimming its year-to-date gain to 16.3%. The Dow Jones Industrial Average
DJIA
rose 0.6%, while the Nasdaq Composite
COMP
shed 1.9%.

A lack of obvious near-term catalysts could set the stage for the market to further struggle. A light week lies ahead for U.S. economic data, featuring July retail sales on Monday and the release of the minutes of the Fed’s July meeting on Wednesday.

A slew of major retailers are set to deliver results as the second quarter earnings reporting season enters its final stretch.

Nationwide’s Hackett said the market setup coming into August was nearly a mirror image of October’s gloomfest. Hedge funds and other large investors are no longer betting against the market, while longtime bears and pessimistic economists are throwing in the towel and issuing mea culpas.

Stocks have rallied since late last year as fears priced into the market didn’t materialize, but now that dynamic is gone.

Related: S&P 500 has a new record high 2023 price target. Here’s a look at Wall Street’s official stock-market outlook.

Just as overwhelming pessimism set the stage for the market rally, widespread optimism over a “Goldilocks” scenario of falling inflation, a tame Fed and solid economic growth could eventually spell trouble for the bulls, Hackett said. Expectations don’t yet appear that extreme, but bear watching, he said.

Meanwhile, investors also face seasonal concerns. August is historically a middling month for the S&P 500, producing an average gain of 0.67% based on data going back to 1928, according to Dow Jones Market Data. That makes August the fifth-worst performing month for the S&P 500. September is the worst performing month, producing an average downturn of 1.1%.

For the Dow Jones Industrial Average, August has seen an average return of negative 0.8% since 1986, making it the worst performing month for the blue-chip gauge. In the decades before 1986, August was the blue-chip gauge’s best month.

Mark Hulbert: August used to be the best month for the stock market. Then it became the worst.

And then there’s volatility.

Going back to 1990, the Cboe Volatility Index
VX00,
-4.91%,
known as the VIX, has seen its yearly peak most often in January (six times), followed by August and October at five times each, noted Jessica Rabe, co-founder of DataTrek Research, in a note last week.

By that measure, investors are now in the middle of one of the most volatile months of the year with still another to come in October.

“U.S. equities tend to outperform during calmer environments, so it makes sense that they rallied in July, but are struggling so far in August,” Rabe said. “The upshot: seasonal trends say U.S. equities could prove whippy through October until quieting down during the last two months of the year.”

Hackett doesn’t expect the bull market to come off the rails, but sees scope for some near-term consolidation that will likely prove healthy over the long run.

“It’s something that you don’t want to try to be too cute with because I don’t see the market as being really susceptible to a significant period of pain. I think it’s just a pretty natural, pretty healthy consolidation phase,” he said.

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August 13, 2023
Inflation could rebound later this year. And that might be a good thing.

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U.S. inflation has slowed down significantly over the past few months, but it faces risks of reacceleration in the fourth quarter, or next year, some analysts are warning.

Data released Thursday showed U.S. consumer prices rose a mild 0.2% in July, while the 12-month rate of inflation edged up to 3.2% from 3% in the prior month, the first annual-rate increase in 13 months, the Labor Department said on Thursday. However, the so-called core rate of inflation, which omits food and energy prices, saw its yearly rate of increase slow to 4.7% from 4.8%, the slowest in almost two years.

On Friday the U.S. producer-price index showed a July rise of 0.3%, up from a revised flat reading in June, and the core PPI rose 0.2 in July, up from a 0.1% gain in the prior month.

“We could very easily see a reacceleration of inflation next year,” as base effects may soon work against inflation numbers, said Kathryn Rooney Vera, chief market analyst at StoneX.

If the inflation rate in the comparable period of the previous year was very low, even just a small monthly increase in CPI or PPI in the current year will render a high inflation rate now and vice-versa.

U.S. inflation accelerated aggressively in the first half of 2022, before price rises slowed in the second half. In June 2022, the annual consumer-price inflation rate peaked at 9.1%; it thereafter started to fall.

The most challenging part of combating inflation was not slowing the yearly consumer inflation rate from 9% to 3% but lowering the yearly inflation rate for core personal consumption expenditures, or core PCE, to 2% from 4.1% in June, noted Rooney Vera of StoneX.

PCE is said to be U.S. central bankers’ preferred inflation metric.

Julian Brigden, co-founder and president of Macro Intelligence 2 Partners, echoed the point. The idea that inflation is defeated is “ultimately wrong,” said Brigden. There are risks of upside surprise for inflation in the fourth quarter, noted Brigden.

“Goods inflation has fallen, food inflation has fallen, and energy inflation most materially has fallen. All of those [base] effects start to drop out in the not-too-distant future,” said Bridgden.

Meanwhile, the U.S. economy remains resilient, with unemployment numbers relatively low, supporting an elevated service-sector inflation rate. The Federal Reserve Bank of Atlanta’s real-time GDP tool forecasts the U.S. economy is growing at a 4.1% rate in the third quarter.

“In a service-based economy based on consumption, with a core PCE that’s overwhelmingly driven by service-sector inflation and this economy could potentially grow in the third quarter by 4%, with real wages positive and unemployment at 3.5%, how do we expect service-sector inflation to drop?” said Rooney Vera. “So the Fed has to make a tough choice: Are they targeting 2% inflation or are they not?”

See: Fed has ‘more work to do’ to get inflation back down, Daly says

Also read: Worker pay at center of Fed’s inflation fight

Federal Reserve chief Jerome Powell said in July that it appeared unlikely inflation would get back to the U.S. central bank’s long-term 2% target before 2025.

“I think it’s actually better off if we see some inflation,” according to Melissa Brown, global head of applied research at Qontigo. “Given the economic numbers and the employment numbers, I think to see inflation really come down, it probably is going to suggest a recession.”

Earlier this year an elevated inflation rate made it difficult for companies to raise prices enough to offset their own rising costs, especially while the Fed was raising borrowing rates. But “even if we see some inflation going into the fourth quarter, that actually could be good. We would switch from this being bad inflation to being good inflation, which just means that the economy is strong enough to sustain higher inflation,” said Brown.

U.S. stock indexes traded mixed on Friday. The Dow Jones Industrial Average
DJIA
gained 0.4%, and the S&P 500
SPX
was unchanged. The Nasdaq Composite
COMP
fell 0.5%.

Read on:

Want companies to lower their prices? Stop buying stuff from them.

‘Greedflation’ is replacing inflation as companies raise prices for bigger profits, report finds

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August 13, 2023
Inflation could rebound later this year. And that might be a good thing.

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U.S. inflation has slowed down significantly over the past few months, but it faces risks of reacceleration in the fourth quarter, or next year, some analysts are warning.

Data released Thursday showed U.S. consumer prices rose a mild 0.2% in July, while the 12-month rate of inflation edged up to 3.2% from 3% in the prior month, the first annual-rate increase in 13 months, the Labor Department said on Thursday. However, the so-called core rate of inflation, which omits food and energy prices, saw its yearly rate of increase slow to 4.7% from 4.8%, the slowest in almost two years.

On Friday the U.S. producer-price index showed a July rise of 0.3%, up from a revised flat reading in June, and the core PPI rose 0.2 in July, up from a 0.1% gain in the prior month.

“We could very easily see a reacceleration of inflation next year,” as base effects may soon work against inflation numbers, said Kathryn Rooney Vera, chief market analyst at StoneX.

If the inflation rate in the comparable period of the previous year was very low, even just a small monthly increase in CPI or PPI in the current year will render a high inflation rate now and vice-versa.

U.S. inflation accelerated aggressively in the first half of 2022, before price rises slowed in the second half. In June 2022, the annual consumer-price inflation rate peaked at 9.1%; it thereafter started to fall.

The most challenging part of combating inflation was not slowing the yearly consumer inflation rate from 9% to 3% but lowering the yearly inflation rate for core personal consumption expenditures, or core PCE, to 2% from 4.1% in June, noted Rooney Vera of StoneX.

PCE is said to be U.S. central bankers’ preferred inflation metric.

Julian Brigden, co-founder and president of Macro Intelligence 2 Partners, echoed the point. The idea that inflation is defeated is “ultimately wrong,” said Brigden. There are risks of upside surprise for inflation in the fourth quarter, noted Brigden.

“Goods inflation has fallen, food inflation has fallen, and energy inflation most materially has fallen. All of those [base] effects start to drop out in the not-too-distant future,” said Bridgden.

Meanwhile, the U.S. economy remains resilient, with unemployment numbers relatively low, supporting an elevated service-sector inflation rate. The Federal Reserve Bank of Atlanta’s real-time GDP tool forecasts the U.S. economy is growing at a 4.1% rate in the third quarter.

“In a service-based economy based on consumption, with a core PCE that’s overwhelmingly driven by service-sector inflation and this economy could potentially grow in the third quarter by 4%, with real wages positive and unemployment at 3.5%, how do we expect service-sector inflation to drop?” said Rooney Vera. “So the Fed has to make a tough choice: Are they targeting 2% inflation or are they not?”

See: Fed has ‘more work to do’ to get inflation back down, Daly says

Also read: Worker pay at center of Fed’s inflation fight

Federal Reserve chief Jerome Powell said in July that it appeared unlikely inflation would get back to the U.S. central bank’s long-term 2% target before 2025.

“I think it’s actually better off if we see some inflation,” according to Melissa Brown, global head of applied research at Qontigo. “Given the economic numbers and the employment numbers, I think to see inflation really come down, it probably is going to suggest a recession.”

Earlier this year an elevated inflation rate made it difficult for companies to raise prices enough to offset their own rising costs, especially while the Fed was raising borrowing rates. But “even if we see some inflation going into the fourth quarter, that actually could be good. We would switch from this being bad inflation to being good inflation, which just means that the economy is strong enough to sustain higher inflation,” said Brown.

U.S. stock indexes traded mixed on Friday. The Dow Jones Industrial Average
DJIA
gained 0.4%, and the S&P 500
SPX
was unchanged. The Nasdaq Composite
COMP
fell 0.5%.

Read on:

Want companies to lower their prices? Stop buying stuff from them.

‘Greedflation’ is replacing inflation as companies raise prices for bigger profits, report finds

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August 13, 2023
S&P 500, Nasdaq finish lower, logging back-to-back weekly losses

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U.S. stocks finished mostly lower on Friday, with only the Dow hanging on to gains, as the S&P 500 and Nasdaq Composite capped off their first back-to-back weekly losses in months. The S&P 500
SPX,
-0.11%
fell by 4.65 points, or 0.1%, to 4,464.18 on Friday, according to preliminary closing data from FactSet. The Nasdaq Composite
COMP,
-0.68%
shed 93.14 points, or 0.7%, to 13,644.85. The Dow Jones Industrial Average
DJIA,
+0.30%
gained 105.32 points, or 0.3%, to 35,281.46. The Nasdaq has fallen for two straight weeks for the first time since a four-week losing streak ended on Dec. 30, according to Dow Jones Market Data. The roughly 4.7% drop during that period is the biggest two-week decline for the index since the week ending Dec. 16.

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August 11, 2023
Here’s what is behind the stock market’s selloff and what we’re doing about it

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August 8, 2023
U.S. stocks would be much lower if it wasn’t for ‘excessive’ government spending, Morgan Stanley’s Mike Wilson says

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U.S. stocks would be in much worse shape in 2023 if it wasn’t for “excessive” fiscal policy from the government and explosive money-supply growth in recent years.

That’s the latest take from Morgan Stanley’s Mike Wilson, the bank’s chief investment strategist who, as MarketWatch’s Steve Goldstein pointed out earlier, seems to never miss an opportunity to recall how wrong his market calls have been this year.

In his latest note, Wilson told clients and the financial press that excessive government spending has helped prop up the U.S. economy and markets to a degree that Wilson and his team failed to anticipate.

“Part of the reason we’ve found ourselves offside this year is that the fiscal impulse returned with a vengeance and remained quite strong in 2023 — something we didn’t factor into our forecasts,” Wilson said in the note.

In an accompanying chart, Wilson noted that fiscal spending looks particularly excessive when compared with the U.S. unemployment rate, which fell to 3.5% in July, according to data from the Department of Labor released on Friday.

MORGAN STANLEY

To be sure, Wilson was one of a select few on Wall Street to correctly anticipating last year’s inflation-driven selloff.

But heading into the New Year, he expected stocks would tumble to new lows during the first half of 2023.

And after hanging on to his bearish view for months in spite of a powerful rally in equities driven by the artificial intelligence craze and a surprisingly resilient U.S. economy, he’s recently taken the opportunity to reflect on why he got it wrong, while acknowledging the possibility that the rally could continue.

See: Morgan Stanley’s Mike Wilson admits ‘we were wrong’ about 2023 stock-market rally, but refuses to throw in the towel

See: Morgan Stanley’s Mike Wilson is warming to the U.S. stock-market rally. Here’s what would make him turn bullish.

It’s possible, even likely, that the government’s excessive spending could continue, at least until it comes time to raise the debt ceiling again in 2025.

Fitch Ratings last week cited projections for ballooning budget deficits for helping to inspire its decision to strip the U.S. of its AAA credit rating.

“The main takeaway for the equity market this year is that fiscal policy has allowed
the economy to grow faster than forecast, giving rise to the consensus view that the
risk of a recession has faded considerably. Furthermore, with the recent lifting of the debt ceiling until 2025, this aggressive fiscal spending could continue,” Wilson said.

The biggest problem with spending so much during good economic times, however, is that it limits Congress’s ability to act when another recession inevitably arrives.

That could create problems for corporate earnings and, by extension, stocks, down the road, Wilson said.

“If fiscal policy is showing such little constraint in good times, what happens to the deficit when the next recession arrives?”

U.S. stocks were trading higher early Monday after the S&P 500
SPX
logged its fourth straight day in the red on Friday, capping off the worst week for stocks since March. The index was up 0.5% in recent trade near 4,500, while the Nasdaq Composite
COMP
was 0.2% lower at 13,881.

The Dow Jones Industrial Average
DJIA,
which has surged higher over the past month as traders have favored some of this year’s market laggards, was up 300 points, or 0.9%, at 35,362.

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August 7, 2023

The S&P 500 hasn’t seen a 2% daily drop in nearly 6 months. Does this mean a selloff is overdue?

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The U.S. stock market has been conspicuously calm for most of 2023, prompting some analysts to question whether investors might be overdue for a powerful jolt of volatility.

It’s been 113 trading sessions since the S&P 500 has seen a daily drop of 2% or more, the longest such stretch since Feb. 21, 2020, according to Dow Jones Market Data.

The last time the large-cap index fell by 2% or more through the close was Feb. 21, 2023, when the index dropped by 2% exactly. That was nearly six months ago.

Such subdued volatility is perhaps the most pertinent indication of just how much has changed for markets since 2022.

When measured by the total number of 2% swings in either direction, last year was the most volatile for U.S. stocks since 2009. The S&P 500 recorded 46 daily swings of 2% or more in either direction last year, compared with 55 in 2009, Dow Jones data show. Of those, roughly half were down days.

This quiet streak has been good for stocks: Since Feb. 21, the S&P 500 has gained nearly 13%, according to FactSet data. And as of Thursday, it was up more than 18% for the year.

But as August has gotten off to a rocky start, with the S&P 500 and Nasdaq Composite on track to finish lower for the first week of the month following a three-day streak of losses, some are wondering if the market might be overdue for a larger and perhaps more aggressive drop.

To the extent that the market’s past performance can tell investors anything useful about the future, historical data compiled by Dow Jones Market Data show that streaks of relative calm have endured for much longer in the not-too-distant past.

However, investors have often paid the price eventually.

The longest streak in recent memory without a 2% drop for the S&P 500 ended on Feb. 1, 2018 after 351 trading days — nearly 18 months. It encompassed all of 2017, a memorably tranquil year for markets that saw the Cboe Volatility Index fall to an all-time low in single-digit territory.

A few days later, stocks would see one of their biggest daily routs in years during the now-infamous “Volmageddon” episode on Feb. 5, 2018 when the Dow Jones Industrial Average fell by 1,175 points while the Cboe Volatility Index, otherwise known as the VIX, doubled, jumped by a record 20 points from 18.44 to a high of 38.40, FactSet data show.

At the time, it was the biggest daily point decline on record for the Dow. Data also show that the index has traded lower one year after the end of such streaks two out of five times.

Date Streak Ended	Length of Streak	6-Month Performance	1-Year Performance
10/08/2014	125	5.74%	2.26%
6/26/2015	179	-1.93%	-3.05%
02/01/2018	351	-0.31	-4.09%
10/09/2018	129	-0.07%	1.36%
02/21/2020	124	1.78%	17.05%

SOURCE: DOW JONES MARKET DATA

Ryan Detrick, chief market strategist at Carson Group, said stocks might be ripe for a larger pullback in August, although he acknowledged that streaks of low volatility have often persisted for much longer.

“While these periods of low volatility can increase the odds of some type of near-term pull back, these trends can last a while,” Detrick said during a phone interview with MarketWatch.

“We might be overdue for a modest 4% to 6% pullback here, but it makes sense that this low-volatility world we’ve been living in could have legs.”

Detrick noted that 2022 saw the biggest pullback for the S&P 500 since 2008 as the index fell 19.4%, according to FactSet data.

To be sure, the selloff in the bond market was even more intense, with many analysts describing it as the worst year for bonds in decades, if not in the history of modern financial markets.

“The whole apple cart got rocked last year,” he said.

Detrick also noted that August and September tend to be more volatile months for stocks.

“The odds are higher that we could see some seasonal volatility here,” he said. “August isn’t a great month for stocks, but it’s even worse when you’ve had a good year going into it,” he said.

U.S. stocks rebounded on Friday following the release of the Labor Department’s July jobs report. The S&P 500
SPX
was up 0.8% in recent trade, while the Nasdaq Composite
COMP
rose by 1%. The Dow
DJIA
was trading 256 points, or 0.7%, higher at 35,474.

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August 6, 2023

Rising Treasury yields spooked the stock market. Now, a key test lies ahead.

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A worsening U.S. fiscal situation caught stock and bond investors off guard in the past week and now a round of approaching government auctions is about to provide a crucial test for Treasurys.

The question in the days ahead is whether risks to the demand for U.S. government debt are growing. If so, that could put upward pressure on Treasury yields, which would undermine the performance of stocks. However, if investors end up caring less about the fiscal situation than they do about the possibility of slowing economic growth and decelerating inflation, government debt’s safe-haven appeal could be reinforced, putting a limit on how high yields might go.

Concern about the deteriorating fiscal outlook was a factor behind the past week’s rise in long-term Treasury yields. Ten-
BX:TMUBMUSD10Y
and 30-year yields
BX:TMUBMUSD30Y
respectively jumped to 4.188% and 4.304% on Thursday, the highest levels since early November, as investors sold off long-term government debt — which took the shine off U.S. stocks. By Friday, though, a moderating pace of U.S. job creation for July sent yields into reverse, giving equities a temporary lift during the final trading session of the week.

At issue is the extent to which potential buyers of Treasurys may be deterred by Fitch Ratings’ Aug. 1 decision to cut the U.S. government’s top AAA rating, at a time when the government is about to unleash what Barclays rates strategists describe as a “tsunami” of supply. A total of $103 billion in 3-, 10-and 30-year Treasurys come up for sale between Tuesday and Thursday. In addition, a spate of Treasury bills are scheduled to be auctioned starting on Monday.

Gene Tannuzzo, global head of fixed income at Boston-based Columbia Threadneedle Investments, said that while he and his team still have room to add T-bills to the government money-market funds they oversee during the week ahead, they haven’t made up their minds about whether to buy more longer-dated maturities for their bond funds.

“While we are comfortable that the Fed is at or near the end of its rate hikes, there are a lot more questions about the durability of the economic recovery, the degree that inflation will remain low, and the risk premium that needs to be put in at the long end,” Tannuzzo said via phone.

Treasury’s $1 trillion third-quarter borrowing plans, along with some technical issues and the Bank of Japan’s decision to switch to a more flexible yield-curve control approach, might reduce demand for U.S. government debt, he said. Columbia Threadneedle managed $617 billion as of June.

“One can’t ignore the risk of an unruly rise in yields, but our view is that this is a low risk and what the Treasury auctions may produce instead is ‘indigestion,’ driven by poor technicals and low liquidity, Fitch’s downgrade, and the Bank of Japan action — and by the end of August, we should be past much of this,” he told MarketWatch.

Key Words: Warren Buffett dismisses Fitch downgrade: ‘There are some things people shouldn’t worry about’

Risks to the demand for Treasurys may become obvious soon, given Tuesday-Thursday’s $103 billion in total sales of 3-, 10- and 30-year securities, according to analyst John Canavan of U.K.-based Oxford Economics. The main “question mark” for the market’s ability to absorb the increased Treasury issuance will be whether or not domestic investment funds continue to show interest, Canavan wrote in a note distributed on Friday.

Source: Oxford Economics.

“ ‘My suspicion is that with higher rates comes equally solid demand’ at upcoming auctions.”

— John Flahive, head of fixed income at BNY Mellon Wealth Management

Market players have had little difficulty absorbing Treasury coupon issuances in recent years because of flight-to-safety trades made after the U.S. onset of the Covid-19 pandemic in 2020. Now, however, increased auction sizes are being accompanied by still-elevated inflation, better-than-expected economic growth, and the possibility of more rate hikes by the Federal Reserve — which is likely to complicate the market’s ability to absorb the increased supply “without hiccups,” Canavan said.

Read: Who is buying all the Treasury auctions? Domestic funds got a record share, but another deluge is coming.

On the flip side of the debate is John Flahive, head of fixed income at BNY Mellon Wealth Management in Boston, which managed $286 billion in assets as of June. He said equity markets will continue to be much more focused on economic developments and earnings. And as long as the latter of the two remains robust, stocks “can grind higher in a low-volatility environment,” Flahive said via phone.

Saying he does not expect his team to be a major participant in the Treasury auctions, Flahive said that the bond market’s reaction in the past week was “a little overdone” and “we always felt that there was a limited to how much yields could go up to reflect more government debt.”

“My suspicion is that with higher rates comes equally solid demand” at upcoming auctions, he said. “I’m still optimistic about rates going back down over time as the result of a slowing economy and decelerating inflation. We continue to like the bond market and see a better-than-even chance that yields go down as the economy continues to weaken in the quarters ahead.”

Friday’s reaction to July’s official jobs report, which showed the U.S. added a modest 187,000 new jobs, provided a breather from the past week’s run-up in Treasury yields.

On Friday, the 30-year Treasury yield fell 9 basis points to 4.214%, yet still ended with its biggest weekly gain since early February. The 10-year rate, which dropped 12.8 basis points to 4.06%, finished with a third straight week of advances.

Stocks fell Friday, leaving major indexes with weekly declines. The Dow Jones Industrial Average
DJIA
posted a 1.1% weekly fall, while the S&P 500
SPX
shed 2.3% and the Nasdaq Composite
COMP
retreated 2.9%. The soft start to August comes after a run of sharp gains for equities. The S&P 500 remains up 16.6% for the year to date.

The economic calendar for the week ahead includes U.S. inflation updates.

On Monday, June consumer-credit data is set to be released. Tuesday brings the NFIB’s small business optimism index, plus data on the U.S. trade balance and wholesale inventories. Then on Thursday, weekly initial jobless claims and the July consumer-price index are released. That’s followed on Friday by the producer-price index for last month and an August consumer-sentiment reading.

Meanwhile, portfolio manager and fixed-income analyst John Luke Tyner at Alabama-based Aptus Capital Advisors, which manages roughly $5 billion in assets, said he plans to follow the Treasury auctions, but doesn’t usually participate in them.

“One of the biggest trends we’ve seen is the continued increase in the issuance amounts from Treasury. Whatever we are budgeting for is never enough, which justifies the Fitch downgrade,” Tyner said via phone. “It’s tough to say people aren’t going to buy U.S. debt, but you’ve got to entice them to buy duration and take the risk.

“The U.S. is not an emerging market, but ultimately we are going to see the market rate that participants require be higher, with a notable uptick in term premia,” he said. “What we could see in the face of all this issuance is a grind up in yields on an auction-by-auction basis. If I look at the technicals, a 4.9%-5% yield on the 10-year note seems in the cards,” and “it will be difficult for stocks to hold or expand from full valuations as rates run up.”

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August 6, 2023
The Stock Market’s Rally Paused. It’s Time to Buy the Dip.

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The Stock Market’s Rally Paused. It’s Time to Buy the Dip.

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August 6, 2023
Surging S&P 500 Targets Finally Caught Up to the Stock Market. Why It’s Time to Buy Dips.

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Surging S&P 500 Targets Finally Caught Up to the Stock Market. Why It’s Time to Buy Dips.

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August 4, 2023
Stocks close lower, S&P and Dow post first weekly loss in 3 weeks after historic U.S. downgrade

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US. stocks closed lower Friday, capping off a volatile week that finished with losses after Fitch took away its top AAA ratings for the U.S. and government bond yields embarked on a wild ride. The Dow Jones Industrial Average
DJIA,
-0.43%
fell about 150 points, or 0.4% on Friday, ending near 35,065, according to preliminary FactSet data. The S&P 500 index
SPX,
-0.53%
shed 0.5% and the Nasdaq Composite Index closed 0.4% lower. For the week, the Dow posted a 1.1% decline, the S&P 500 a 2.3% drop and the Nasdaq shed 2.9% since Monday, according to FactSet. Investors were focused on July jobs data released on Friday for clues to the health of the economy and potential next moves by the Federal Reserve on rates. The 10-year Treasury yield
TMUBMUSD10Y,
4.045%
swung almost 13 basis points lower on Friday to 4.06%, after briefly climbing to about 4.2% earlier in the week, according to FactSet data.

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August 4, 2023

Tag: Dow Jones Industrial Average

Returns on U.S. government bonds turn negative for the year.

Record cash on the sidelines

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