Market Update: Tuesday, October 16, 2018

LPLResearch-Macro-View

Daily Insights

  • New LPL Market Signals Podcast. On the latest episode of the LPL Market Signals Podcast, listen to LPL Financial Chief Investment Strategist John Lynch and Senior Market Strategist Ryan Detrick discuss signs for strong third-quarter earnings and a potential year-end rally following the stock drop.

  • Introducing LPL Research Weekly Insights: We are excited to introduce a mobile-friendly, client-approved overview of our weekly commentaries and blog highlights. LPL Research Weekly Insights is easily shared via social platforms and email, and can also be embedded on your websites. Get our most recent digital download today, and look for an update this afternoon!

  • Stocks resume slide. The S&P 500 Index slid 0.6% yesterday, extending losses to 6.1% since the benchmark closed at a record high on September 20. The S&P 500 has closed lower in 13 of 17 trading sessions since then as investors have had to contend with a surge in longer-term yields and trade war concerns.

  • Italy’s budget agreement. U.S. equities are higher this morning amid a worldwide rally in equities after Italy’s government reached an agreement on its budget, which will be submitted to the European Union (EU). European stocks climbed the most since September 20 on the accord, which promises to ease political tensions after Italy’s leaders unveiled a deficit target earlier this month that clashed with the EU’s limit.

  • Takeaways from fixed income. Last week’s sharp equity selloff broke months of historic calm for U.S. stocks. As investors clamor for answers, we highlight our biggest takeaways from credit’s response to the volatility in today’s LPL Research blog post, due out later today.

  • Treasury futures’ positioning. Non-hedging investors in 10-year Treasury futures think the surge in yields is overdone. Investors added the most long contracts to their positions since April 2017 in the five days ending Oct. 9, after the 10-year Treasury yield jumped to its highest level in seven years on Oct. 5. We view this positioning as an indicator of sentiment in Treasuries, which could signal a future path for yields. Before this month, investors had built a record short position in 10-year Treasury futures, predicting lower prices (and higher yields).

LPLResearch-Monitoring-the-Week-Ahead

Click Here for our detailed Weekly Economic Calendar

Tuesday

Wedensday

Thursday

Friday

  • Existing Home Sales (Sept)
  • Baker Hughes U.S. Rig Count (Oct)


IMPORTANT DISCLOSURES

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.

All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

All company names noted herein are for educational purposes only and not an indication of trading intent or a solitication of their products or services. LPL Financial doesn’t provide research on individual equities.

All performance referenced is historical and is no guarantee of future results.

This research material has been prepared by LPL Financial LLC.

To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL Financial LLC is not an affiliate of and makes no representation with respect to such entity.

The investment products sold through LPL Financial are not insured deposits and are not FDIC/NCUA insured.  These products are not Bank/Credit Union obligations and are not endorsed, recommended or guaranteed by any Bank/Credit Union or any government agency.  The value of the investment may fluctuate, the return on the investment is not guaranteed, and loss of principal is possible.

Index data obtained via FactSet

Member FINRA/SIPC

For Public Use – Tracking #1-782413 (Exp. 10/19)