Rising yields are taking their toll on the S&P 500, so much so that stocks are currently more volatile than Bitcoin. Without a Fed pivot in sight, stocks may have to have a sharp correction before yields stop moving higher.... Read More
The extreme pace of global central bank tightening is causing turmoil across all financial markets. Much of the focus is on the "liquidity hole" in the bond market, however equity markets are showing cracks. ... Read More
As the dollar continues its relentless rise in 2022, stocks in the S&P 500 most heavily dependent on foreign revenues have underperformed stocks focused on U.S. revenues.... Read More
2022 has been a year of asking, "could it get any worse?" With central banks raising rates at a historic pace, financial markets are feeling the pressure. The S&P 500 has fallen roughly 24%, but signs of panic have yet to appear even as large traders abandon positions. ... Read More
As the Fed hikes and short rates increase, long rates should get dragged higher. Economic data would need to weaken meaningfully to change this outlook.... Read More
The S&P 500 Total Return Index, adjusted for inflation, sank below the last bull market peak of February 19, 2020.... Read More
Globally, stocks' and bonds' combined market caps have declined over 15%.... Read More
Redfin's alternative measures of the housing market continue to show a deceleration in the crazy conditions of the last year.... Read More
The Fed has been explicit in their goal to continue raising rates, but the markets are still hoping for a pivot. Behind this tension is a disagreement about the long-term outlook for inflation. Is it persistent?... Read More
10-year yields are up nine straight weeks, the longest such streak in over 28 years. History shows this type of rise in yields typically proves detrimental for the stock market.... Read More
The bond market suffers from high volatility, illiquidity, stress, and record losses. These problems are spilling over into the currency and stock markets. ... Read More
Equity markets have yet to show full panic even as macro headwinds grow. With flows and volatility showing no signs of capitulation, we are unlikely at a bottom until positioning shifts.... Read More
The labor market is not showing signs of faltering, which is only adding to fears the Fed will continue hiking. Stress is showing in the markets, however.... Read More
In Chairman Powell's press conference on Wednesday, he said the Fed would like to see interest rates "across the entire yield curve" move above the inflation. If positive real rates are the goal, rates have to move another 100 basis points higher.... Read More
As hawkish talk continues, the forward curve is pricing in a higher terminal rate. This pushes up the 2-year yield. If the yield curve holds its current spread, the 10-year should also shift higher.... Read More
The pressure is back on the Bank of Japan as 10-year JGB rates hover around their preferred upper limit of 0.25%.... Read More