Market gives up some gains into the weekend. Following the historic run over the past three days, US equities are lower in early trading Friday. The United States now has more confirmed cases of COVID-19 than China, though far fewer deaths. The stimulus package is expected to pass through the House of Representatives today before heading to the White House for President Trump’s signature, though if any lawmaker objects to the special “voice vote,” a delay remains a possibility.
Will investors take weaker economic news in stride? Earlier this week, the IHS Markit Flash U.S. PMI Composite™ for March 2020 reached an all-time series low, with manufacturing and services being hindered by COVID-19 and social distancing. In our Road to Recovery Playbook, we have a factor that emphasizes whether or not there is visibility into the probability and severity of a US recession. We believe this particular economic release certainly points toward recession, but importantly, we believe that was already the expectation of most investors. In fact, on the day of this economic release, the S&P 500 Index rallied nearly 10% as investors increasingly believed Congress would pass a massive fiscal stimulus package. For more details read today’s LPL Research blog.
A bull market? The Dow gained more than 20% from the recent lows in a record three days. Many in the media have dubbed this a new bull market. At this time, the market is in the process of forming a bottom, but we’d be very careful to call this a new bull market as large bounces tend to happen, even in bear markets.
Could yields actually rise after the Fed’s bazooka? With the major stock market indexes all entering a bear market this month, it’s no surprise that stocks have stolen most of the spotlight. However, actions taken by the Federal Reserve (Fed) to support what may be considered the safest part of the bond market, US Treasuries, may actually have more lasting implications for investors’ portfolios. We look at where Treasury yields might be headed following unprecedented moves by the Fed over the past week in today’s Blog.
Recently, you may have seen reports that a record-low number of homes are available for sale—roughly 1.03 million nationwide. If you compare that to the average number of homes for sale during the past 10 years, it’s no surprise that many hopeful homebuyers are having issues securing a home. But why exactly is the housing … Continue reading “Forces Driving the Housing Market”
It can be exhausting trying to keep up with the whims of Wall Street. Lately, the financial markets have been fixated on federal taxes and what may be proposed on Capitol Hill in the weeks and months ahead. Wall Street’s focus on taxes closely follows its attention on the 10-year Treasury yield. And it wasn’t … Continue reading “The Whims of Wall Street”
President Joe Biden introduced the much-anticipated American Jobs Plan, which outlines an approach to spend roughly $2.2 trillion on the nation’s infrastructure and other projects. As part of the legislative process, the Biden administration also laid out a proposal for paying for the domestic investment. The plan includes raising the corporate tax rate to 28% … Continue reading “Paying for the Infrastructure Bill”
Financially, many of us associate the spring with taxes – but we should also associate December with important IRA deadlines. This year, like 2020, will see a few changes and distinctions. December 31, 2021, is the deadline to take your Required Minimum Distribution (RMD) from certain individual retirement accounts.
There’s an old Wall Street maxim that says, “markets climb a wall of worry.” And these days, there’s plenty to worry about with the trend in long-term interest rates and bonds.
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