Financial Markets Newsletter

S&P 500 Index September 2020

Navigating the Waves

There are waves of uncertainty circulating the news cycle every day. Presidential election, economy, recession, recovery, Fed policy, housing, riots, coronavirus, vaccinations and it gives everyone a headache. It is tough to get clarity on these matters these days and the stock has certainly reflected this sentiment these past three weeks. Many are calling for […]

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S&P 500 Vs Volatility

Power Brakes

All of the major indices had a rough week as the NASDAQ led the way lower with a loss of 4.1% – the worst week since March. However, the momentum to the downside abated into Friday’s close and volatility did not spike this week like we saw in the steep sell-off in March. In the […]

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The S&P 500 Index vs 30 Yr Treasury Yields


The Chairman of the Federal Reserve announced a change to how policy is conducted with regards to inflation which the market interpreted as lower for longer. Under this methodology, the interest rate increases which began in 2015 would have never happened. With rising inflation expectations due to monetary expansion (quantitative easing) and exploding deficits, the […]

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S&P 500 Trendline

Summer to Fall

Summer trading is rounding third base and so might this rally from the March low. The size of the rebound does not match the recovery in the economy as stocks have front-run a return to normalcy. As we approach the seasonally weakest part of the calendar, the market will need to wrestle with the uncertainty […]

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S&P 500 Vs 30Yr Treasury Yields

Summertime Convergence

The stock market continues to grind higher as we approach the Fall months and the Presidential election. The push higher over the last several weeks is signaling a sharp rebound in the economy which may be wishful thinking. Several companies claim to be close to a vaccine for COVID-19 but my understanding is that confirming […]

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Divergence Continues

The divergence between long-term Treasury bonds and stocks continues to keep going. The chart below shows how pronounced this divergence has become as the S&P continues to edge higher. Most times, these two will trade in tandem so the bond market is trying to tell us that the economy will remain in slow growth for […]

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The S&P 500 continues to hover below its June 8th high (3,234) as the earnings season kicks off and the country struggles with a new wave of coronavirus cases in the southern states. The uptrend from the March low is stretching valuations and continues to be driven by a handful of large-cap technology stocks which […]

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Rebound Madness?

The rebound from the March low continued this week as the large-cap technology stocks power the S&P and NASDAQ higher. As the chart below shows, the indices have become heavily concentrated in just a handful of names as the breadth of the market narrows. More than 95% of tech stocks were above their 50-day averages […]

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