Daily Insights

• Retail sales gain for a sixth consecutive month. U.S. retail sales increased 0.5% in July, posting sixth straight months of growth for the first time since 2014 and handily beating consensus estimates (0.1%). Excluding automobiles and gas, sales rose 0.6%. Consistent growth in retail sales reflects the health of the U.S. consumer, emboldened by fiscal stimulus implemented earlier this year. Control-group sales, which are used to calculate gross domestic product, increased 0.5%, above consensus expectations for a 0.4% gain, pointing to another strong quarter of economic growth.

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Several indicators suggest fixed-income investors are rightfully skeptical of recent signs suggesting pricing pressures are running too high. Continue reading →

Daily Insights

• Fixed income sentiment and inflation. Shorter-term breakeven inflation rates have dropped to their lowest levels of the year, implying market expectations for persistent inflation continue to dwindle. Today on the LPL Research blog, we analyze fixed income’s tempered reaction to recent inflation data, which has weighed on longer-term rates.

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Don’t look now, but on August 22, 2018, this current bull market will top the 1990s bull market as the longest ever. However, be aware that the 1990s bull market saw the S&P 500 Index gain 417%, while the current bull market is up approximately 320%—so you can’t call this the greatest bull market…yet. Continue reading →

Daily Insights

• Impressive earnings season enters final stretch. With more than 90% of S&P 500 Index companies having reported second quarter results, year-over-year earnings growth for the index is tracking to an impressive +24.4%, nearly 4% above expectations as of June 30. Also impressive, revenue growth is tracking to +9.3%, an unusually large 1%-plus upside surprise. Beat rates for earnings and revenue are both well above long-term averages at 79% and 71%. Finally, also impressive, forward four quarter estimates have risen 0.6% during reporting season, breaking the historical pattern of declines and suggesting tariffs have had little broad impact on companies’ outlooks. This week company reports tail off with just 14 S&P 500 companies due to report.

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US: S&P 500 Index -0.28%, Dow -0.58%, Nasdaq +0.34%
Europe: STOXX Europe 600 -0.9%, German DAX -1.5%, France CAC 40 -2.6%, U.K. FTSE 100 -1.7%
Asia: Japan Nikkei -1.0%, China Shanghai Composite +2.0%, Korea KOSPI  -0.2%
Rates/Commodities: 10-Year Treasury yield -9 basis points to 2.86%, WTI crude oil -1.1%, COMEX gold -0.3%

Global markets moved lower this week, as overseas turmoil on Friday erased the week’s earlier gains. Continue reading →

We are excited to share some of our favorite tweets from July 2018, beginning with continued highlights from the LPL Focus mainstage presentation of Burt White, our chief investment officer and managing director, Investor and Investment Solutions: Continue reading →

Daily Insights

• LPL Research on CNBC. In case you missed it, LPL Research Senior Market Strategist Ryan Detrick was on CNBC’s Trading Nation yesterday talking about the S&P 500’s four-month winning streak. View the interview here.

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The Federal Open Market Committee (FOMC) announced last Wednesday that it would keep interest rates unchanged, a decision that markets largely expected. However, the FOMC upgraded its view of the economy to characterize it as growing at a “strong” rate for the first time since 2006. Continue reading →

Daily Insights

• More sanctions for Russia. The U.S. announced new sanctions on Russia in response to the Russian government’s involvement in a March 4 chemical attack. The sanctions, expected to take effect on August 22, limit U.S. exports to Russia that could be used for military purposes, according to news reports. Russia then threatened to retaliate in response to the new sanctions, driving the ruble to its lowest point since 2016 vs. the U.S. dollar. While these latest sanctions would be a small drop in a bucket in the context of trade discussions, any geopolitical headlines could inject volatility into the stock market.

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