Stocks shrug off tensions. U.S. stocks opened little changed, shrugging off heightened geopolitical tensions after the U.S. airstrike in Iran. Investors are still evaluating what the attack could mean for financial markets and how Iran could respond. However, for now, it looks like U.S. investors think escalating tensions won’t materially impact fundamentals (a view we agree with at this point). For more of our thoughts on possible market implications of the Iran attack, check out our January 6 LPL Research blog post, “What Mideast Escalation Means for Markets.”
New year, same 10-year yield. It’s a new year with the same old action in the 10-year U.S. Treasury yield. The 10-year yield climbed as high as 1.92% in late December 2019, then slid on U.S. airstrike headlines as the calendar turned. The benchmark has struggled to close above 2% for several months now as headlines and global buying pressure have weighed on longer-term yields. We expect these forces to continue capping yields in the near-term.
U.S. manufacturing declines. U.S. manufacturing health slid to an economic cycle low in December, according to the Institute for Supply Management’s Purchasing Managers’ Index report. We had hoped to see some stabilization in domestic manufacturing accompany trade progress, but Friday’s report showed the sector may take a while to bounce back. We’re still constructive on economic fundamentals, though, even amid manufacturing’s malaise. We’ll dig into recent manufacturing data more today on the LPL Research blog.
The last decade and the next. Listen to our first Market Signals podcast of the new year as Chief Investment Strategist John Lynch and Senior Market Strategist Ryan Detrick review the last decade, the hits and misses of 2019, what they expect in 2020, and the curse of the Mothman.
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 professional prior to investing. The economic forecasts set forth in this material may not develop as predicted.
All company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities.
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.
The modern design of the S&P 500 stock index was first launched in 1957. Performance back to 1950 incorporates the performance of the predecessor index, the S&P 90.
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.
Investing in foreign and emerging markets securities involves special additional risks. These risks include, but are not limited to, currency risk, geopolitical risk, and risk associated with varying accounting standards. Investing in emerging markets may accentuate these risks.
All performance referenced is historical and is no guarantee of future results.
This research material has been prepared by LPL Financial LLC.
Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).
Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL is not an affiliate of and makes no representation with respect to such entity.
- Not Insured by FDIC/NCUA or Any Other Government Agency
- Not Bank/Credit Union Guaranteed
- Not Bank/Credit Union Deposits or Obligations
- May Lose Value
For Public Use – Tracking # 1-934575