2020 is off to a roaring start, picking up right where 2019 left off. Many investors are eyeing the upcoming presidential election as an impending storm for the stock market. In the four-year presidential cycle, pre-election years have tended to be the strongest for stocks, as sitting presidents have taken measures to boost the economy and stock market higher to garner votes. It sure worked out well last year, with the S&P 500 Index’s 31% total return. Continue reading
Charging past 3,300. Trade optimism and fourth-quarter earnings results continue to lift U.S. stocks. The S&P 500 Index rose 0.8% on Thursday, breaking above the 3,300 level to close at another record high. Equity markets continue to make new highs with several sectors participating. Continue reading
A milestone in the U.S.-China trade dispute has boosted corporate sentiment, according to the Federal Reserve’s (Fed) latest Beige Book.
In the Beige Book, the Fed presents qualitative observations made by community bankers and business owners—or “Main Street”—about economic (housing, labor market, manufacturing, nonresidential construction, prices, tourism, wages) and banking conditions (lending conditions, loan demand, loan quality). Continue reading
A trade milestone. U.S. stocks are higher, adding to all-time highs amid another breakthrough in the U.S.-China trade relationship. The S&P 500 Index notched its fourth record high in January after the United States and China signed a phase-one trade deal on Wednesday. Continue reading
Fourth quarter earnings season kicked off this week with 24 S&P 500 Index companies slated to report results. Our expectations are for a marginal increase in S&P 500 earnings per share (EPS) on a year-over-year basis, based on current FactSet consensus estimates (-2% year over year) and the average historical upside of roughly 3 percentage points. Continue reading
Signing day. It’s the scheduled signing day for the U.S.-China phase-one trade agreement, but details of the deal seem to be disappointing global markets. Current tariffs on Chinese imports will likely remain unchanged until later this year, and there are no details in the pact on future talks, according to reports. Continue reading
Consumer inflationary pressures grew at a healthy, but manageable rate in December 2019.
The core Consumer Price Index (CPI), which excludes food and energy, rose 2.3% year over year last month, around the fastest pace of the economic cycle. As shown in the LPL Chart of the Day, core CPI growth has been steady, thanks to firm U.S. demand, despite slowing producer price and wage growth. Continue reading
Another record high. U.S. stocks are little changed this morning as investors assess the first round of earnings reports after the S&P 500 Index’s third record high of 2020. Trade optimism is also buoying risk sentiment, with the United States and China poised to sign a phase-one trade agreement Wednesday. Continue reading
Stocks higher. U.S. stocks are higher this morning ahead of a busy week for investors. Earnings reports for the fourth quarter of 2019 will start rolling in on Tuesday, and the United States and China are poised to sign a limited trade agreement on Wednesday. For now, financial markets have shrugged off the prospects for further escalation in the Iran conflict, but that situation could still flare up at any moment. While stocks could continue pushing higher, we encourage investors to be prepared for volatility with major indexes at record highs. Continue reading
U.S. companies’ hiring momentum slowed in December, ending an otherwise upbeat 2019 on a somewhat down note.
Nonfarm payrolls rose by 145,000 in December, below consensus estimates for a 160,000 gain. Manufacturing payrolls slid by 12,000, their biggest drop since August 2016, as the sector struggled with weakening global demand and lingering U.S.-China trade tensions. Calendar quirks related to the late Thanksgiving may have also played some role in the shortfall. Continue reading