Stableford Capital Insights

Despite a hot economy, two months of strong numbers and the potential for re-acceleration in inflation Fed Chair Jay Powell chose to ignore the unruly data points during the March Fed meeting presser. All this jawboning kept rates subdued during March. Ten-year U.S. Treasury yields fell 5 basis points.

The economy is performing better than expected by most measures. Equities reflect this. However, they are starting to feel a bit stretched on valuation, driven by the promise of “AI”. Read the February Market Commentary for a detailed overview of the situation.

The significant November rebound in equities stands in stark contrast to the disappointing earnings season and 5% rates that drove October lows. Read the November Market Commentary for a detailed overview of the situation.

After beginning the year on a strong note equity and bond prices fell during February as strong economic data quashed hopes of a rapid Fed pivot. Ten-year U.S. Treasury yields leapt 42 basis points to 3.92% in February following a strong January payroll report of 517,000 additions, far above the highest economist estimate. The February Market Commentary will help explain what is going on.

Have soft-landing expectations peaked? Equities fell 4.9% at the August low before rebounding to close down 1.9% for the month. It seems that expectations finally got so high that the market was unable to meet them. The August Market Commentary will help explain what is going on.

Second Half Kickoff—A dichotomy between rates and equities: Equities rose another 3% during July, driven by expectations of a Fed pause and lower inflation. The equity upswing is at odds with U.S. 10 Yr. Treasury rates, which increased during July. The July Market Commentary will help explain what is going on.

Mid-Year Checkup—What happened in the first half of 2023? The first half of 2023 was surprising because when the Fed has tightened this quickly in the past it has led to significant economic downturns due to a negative wealth effect. The June Market Commentary will help explain what is going on.

Is bad breadth unhealthy for equities? Equities were up a slight 0.2% in choppy trading during May. The bigger story is the spread between the S&P 500 and the equal weighted S&P 500. The May Market Commentary will help explain what is going on.

Ever feel like you are running really fast but not getting very far? April was that kind of month. After recovering from the banking kerfuffle in March, the S&P 500 moved in a much narrower range during April and eked out a 1.5% gain for the month. The April Market Commentary will help explain what is going on.

Banking woes pushed the 24/7 inflation watch to the back pages for the first time in a year. Financial stability fear is the first real push-back to the relentless Fed rates hikes, and it is having real impact. Early in March it seemed the Fed was on its way to re-accelerating to a 50 basis point increase. But the bank deposit crisis caused the Fed to slow in order to maintain financial stability. The March Market Commentary will help explain what is going on.