December 2022

The Week Behind In the week ahead of the Christmas Holiday, as expected, volume was lean. I think this contributed to the magnitude of the volatility experienced as the Bank of Japan (BoJ) made a major policy change, influential companies reported earnings, and economic data was hotter than expected. Only the DOW managed to eke…

The Week Behind Despite the benign CPI, the Fed provided a more hawkish outlook than anticipated, catalyzing a multi-session sell-off. Principally, Powell made it clear, while recognizing improvements in inflation data, the Fed will not be satisfied until wage inflation is tamed, which, according to their projections, may require unemployment to reach 4.6% by the…

The Week Behind Prompted by an article in the WSJ authored by Nick Timiraos, the Fed Whisperer, which implied a terminal rate above 5%, recession talk dominated last week’s tape. Talks centered on the variable and lagged effects of what would be 500+ basis points of tightening at a record pace as steep inversions across…

The Week Behind  In my view, last week’s major economic developments – Powell’s speech, PCE, November Payrolls – were balanced. They each had a little something for the bulls and a little something for bears. Despite the neutrality, markets across asset classes – currencies, bonds, equities – reacted to each with a bullish bias. Endorsed…

The Week Behind  During the holiday trading week, indices put on some turkey weight as yields and the dollar continued to show weakness. In my view, Wednesday’s releases, on balance, justify the moves made across markets: stocks, bonds, currencies. Of those releases, the FOMC Minutes proved to be the most consequential. In line with prior…

The Week Behind  In a week characterized by crosscurrents, major indices leaned slightly lower. With respect to inflation, while PPI continued downward, reinforcing CPI, hotter-than-expected U.S. Retail Sales provided some contrary data. Otherwise, the markets had to contend with a missile incident in Eastern Europe and an incredibly hawkish FED President. The DOW closed the…

The Week Behind  A Cool CPI for October means a cool week of gains for the majors. As CPI hit the wire, the US2YR and US10YR each lost ~30bps: a massive move in the bond market. Equally impressive, the USD experienced its worst day in 7 years. In other words, both the bond and currency…

The Week Behind  The FED was uncomfortably hawkish and Payrolls were uncomfortably hot. While there is nuance to each, the week saw the majors end lower as treasury yields ended higher. The DOW trimmed 1.4%, S&P lost 3.35%, and the NASDAQ dropped 5.45%. For a second consecutive week, this time in a down tape instead…

The Week Behind  Despite what can only be characterized as a mega-cap meltdown, the major indices ended the week firmly in the green. Treasury yields and the USD behaved as weak earnings and economic data provided the first signs of definitive evidence FED policy is having the intended effect on the real economy, which fuels…

The Week Behind  In the first full week of earnings season, the major indices put together a strong performance. While the US Dollar and Treasury Yields also ended higher, both retreated from their highs in the latter half of the week, allowing equities to turn green on “better-than-feared” earnings. For now, it appears stock prices…