Cross-asset strategy: Higher rates was one of late 2020’s most-consensus views, but higher rate volatility was not. Hence, this week’s broad deleveraging across Equities, the EM complex and parts of Commodities as the DM Bond sell-off became disorderly. US money markets have been too quick to price the beginning of the end of easy…...
Research Report Insight #1 The benchmark index fell ~1% for the month, breaking from the typical seasonal pattern. February is usually a down month for the market and yet, the benchmark index rose ~2.6% for the month, also breaking a seasonal pattern dating back to the turn-of-the-century. In the chart above, if just go back…
Welcome back to Finom Group’s weekly Research Report cycle (3 weeks on, 1 week off). Investors have muddled through the back half of February with markets trending lower and volatility trending higher (VIX). The S&P 500 (SPX) rose during the first 2 months of February only to fall, to a lesser degree, in the final…...
Welcome to this week’s State of the Markets. Please click the following link to review this week’s SOTM. In this week’s episode, we catch up on some of our market quantitative studies, rationalize the bond market sell-off that is equating a VaR shock in equities, and look at the yield curve more in depth. One thing is for certain, there are no…...
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Cross-asset strategy: Almost irrespective of macro tremors like the Texas energy shock, Bonds continue to telegraph confidence in the economy and skepticism of Fed guidance. That’s unsurprising given a Fed/fiscal experiment with a Yellen Treasury slogan (“go big”) to rival a Yellen Fed slogan from 2016 (“high-pressure economy”). It seems premature to fret about an…...
Welcome to Finom Group’s weekend data Mash-up at February’s month-end. With one week left in the trading month, the S&P 500 has grappled back all it had lost in January and then some. While the benchmark index seems in need of a rest and breadth has weakened over the previous trading week, last Friday’s decline…
By Marty Makary of the Wall Street Journal Amid the dire Covid warnings, one crucial fact has been largely ignored: Cases are down 77% over the past six weeks. If a medication slashed cases by 77%, we’d call it a miracle pill. Why is the number of cases plummeting much faster than experts predicted? In large…
A strong US consumer setup at a time of economic reopening to unleash pent-up demand and drive growth. Our positive 2021 outlook was anchored on stronger and earlier-than-expected consumer recovery and pickup in mobility post-Covid-19 vaccine, releasing cyclical and pent-up demand. We expect consumers to blowout expectations for rest of the year given: (1) economic…...
Many believe that bond yields will not be able to move up much, partly as there is no sustained inflation, and partly as the economy is holding a lot of leverage. Further, the general sentiment is that, if the bond yields do move higher, that could become a problem for the broader market, given the…...
