DAILY INSIGHTS
Stocks opened solidly higher. Markets appeared to like this morning’s combination of the start of earnings season and unfolding plans to reopen the US economy. Markets took big bank results in stride. Asian markets got a boost overnight from better than expected import and export data out of China, helping to shore up confidence in the economic recovery path globally. Texas regulators are meeting to discuss oil output cuts. The International Monetary Fund (IMF) released its World Economic Outlook.
Mixed signals from bond market. Some signals from the bond market mirror recent equity market optimism, but some caution is still reflected in Treasuries. Implied inflation expectations based on Treasury inflation-protected securities (TIPS) have bounced back meaningfully, and high-yield credit spreads have shown significant compression, though they remain wide. We haven’t seen much movement in 10-year Treasury yields, especially given added support from quantitative easing, although it is still early. It may still take some time to get a risk-on signal from bonds, but progress is encouraging.
Could stocks finish 2020 higher? The S&P 500 Index was down more than 30% year to date on March 23. After a nearly 25% bounce in 13 days, could stocks really finish in the green this year? If they did, it would be the largest reversal ever, topping the 2009 reversal. We will discuss this more today on the LPL Research blog.
IMPORTANT DISCLOSURES
This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.
References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.
Any 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 information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This Research material was 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 that is not an LPL affiliate, please note LPL 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 1-982155