The View From Fifth Avenue

Equities rallied in a welcomed reprieve today as yields took a breather from the relentless thrust higher we have become accustomed to lately. This morning’s weaker than expected ADP Employment report proved opposite to the yesterday’s surprisingly optimistic JOLTs number. The market rewarded this “bad” news as the “good” it needed to rally on a cooling labor market’s key role in helping to bring inflation back in check and put a stop to yields going higher and/or having to stay there for lon…

Despite the “holiday” that comes at the end of this month, it’s September that’s supposed to “scare” the bejeezus out of the market; and that it did. But the yield ghosts and goblins remain out in force as the Street slowly comes to grips with an elevated interest rate environment that is starting to feel like the new normal. JPM CEO Dimon reiterated his call for 7% rate hikes, Fed officials added (again) we would be higher for longer, echoed by Yellen this afternoon. And last night Cleveland F…

Alas, a new quarter is upon us- hopes and dreams renewed of history ready to repeat itself with a seasonally strong quarter to finish off the year. Unfortunately, however, a surprise side-step of a US government shutdown over the weekend, encouraging China PMI data, and the sun shining down on NYC this morning proved ultimately futile in quelling the market’s underlying nerves. The macro headwinds remained strong and steady in the face of a hopeful lot this morning. The ISM Manufacturing pri…

The weather has been ugly in New York today, an apt comparison to how equities fared this month and quarter. None of the indexes posted a gain, with 22 of the 24 GICS sectors lower as well. And over the quarter, Treasury yields (for the 10-yr) moved from 3.84% to 4.58%, as the higher for longer theme sunk in. With that as a backdrop, markets today moved lower throughout the session, with the S&P 500 closing down 27bps, and Nasdaq up 14bps. Investors continue to monitor economic data for FOMC cl…

‘Every day is a knife fight over here.’

What started off as another tough day for major US equity indices, ended with the SPX and Nasdaq flat to slightly higher with no fundamental reason whatsoever. Mark Zuckerberg talking about AI, and McConnell saying he would work to avoid a shutdown, were clearly not the triggers for the rebound. Currently, markets are being dictated by emotion and positioning without any new, clear macro guidance to give investors direction in a meaningful way. Thus, investors continue to wait with hope that Fr…

Nobody likes to lose the quarter, but sometimes it is unavoidable. US Equities are limping off to the sidelines as the end of Q3 is only days away now. All signs are pointing to a “Loss” particularly after the S&P500 fell to new 3mo lows today as the headwinds continue to build in the complicated macro backdrop markets are attempting to navigate. Despite breaking the losing streak for a brief respite yesterday, US indices continued their downward slide today as the macro data further contribu…

Markets followed the New York weather today with a dreary and dull performance. S&P 500 volumes were down 15% compared to the 20d average and performance was choppy at best before eventually closing higher on the day. Headwinds continue to develop for US equites as the S&P and Nasdaq closed below their 100-day moving average for the fourth day in a row. US treasuries have become more of a concern for equities lately, especially with longer term yields continuing to climb. The US10Y and US30Y ar…

It has been another rough week for equities as the main indexes posted their third weekly loss. The Fed has been diligent in their messaging approach about “higher for longer”, but while the CME data had that modeled (5.25-5.5% until May 2024), some on Wall Street apparently did not believe it. Looking at the moves in Treasuries this week, some portfolio adjustments have been made. 2-year and 10-year yields have moved back to 2007 levels, pressuring stocks in the process, as investors try to co…

We’ve gone from hike to hold. From the US to SNB to BoE, central banks maintained the status quo this week, and even those that hadn’t signaled the end is nigh. Even so, it’s not being taken well. The market wanted cuts YESTERDAY; that clearly isn’t going to happen, and the issue revolves around when will they come. The Fed kicked the transitory can down the road for far too long and the Street now fears they may be doing the same with the higher for longer narrative. Brief reminder: cuts were…