April 6, 2023 – Sunday will be Easter. And Easter is a time to reflect on all the blessings in one’s life and to appreciate what one has. I am especially thankful for my family (Helen, Matt, and Jessica), for a great team at work, and for the partners I can collaborate with at Robertson Stephens.
Taking time to focus on those blessings helps provide needed context when I am worrying about a possible recession, banking stress, bond yields, inflation, corporate earnings, and the continuing war in Europe.
And by the time Memorial Day comes around in late May, we will have more clarity on:
Fed Rate Hikes: Will the historic rate hike campaign end in May?
Banking Crisis: Do any more regional banks fail?
Economic growth: Does the U.S. economy hit a wall?
Geopolitics: Will there be any peace progress in Ukraine?
Earnings: Can current earnings expectations ($225 for 2023 and $240 for 2024) hold up?
Each of these events could cause volatility over the coming months, whether we like it or not.
Stocks have proven resilient recently, but if the economic data starts to consistently point towards an economic hard landing, then we should not be surprised if the S&P 500 drops and potentially revisits the recent lows near 3,800.
There are a lot of moving pieces in this market right now, but the most important influence on stocks is economic data, because if the data rolls over hard, it doesn’t matter if the Fed is pivoting – because it’s already too late and the economy is already behind the 8 ball (and that will hit stocks).
This month’s jobs report will be released tomorrow (April 7), on a day the market is closed, but the impact will be felt on Monday because the risks for this report are now two-sided!
If the jobs report is too strong, it will increase rate hike concerns and hit stocks.
If the jobs report is too weak, it will amplify the “hard landing” worries that have weighed on stocks this week.
So in addition to spending time with family and friends, I will also be focusing on the above issues this weekend because with the S&P 500 above 4000, a hard landing is not priced in, leaving this market vulnerable to a 5% – 10% pullback. My team and I will continue to stand on the wall watching over your portfolio.
Happy Easter.
Our clients rely on us for timely information, and our job is to deliver.
Securities offered through Fortune Financial Services, Inc. Member FINRA/SIPC. Robertson Stephens Wealth Management, LLC and Fortune Financial Services, Inc. are separate entities and are not affiliated.
Two-Sided Risk in Tomorrow’s Jobs Report
By John Lau
April 6, 2023 – Sunday will be Easter. And Easter is a time to reflect on all the blessings in one’s life and to appreciate what one has. I am especially thankful for my family (Helen, Matt, and Jessica), for a great team at work, and for the partners I can collaborate with at Robertson Stephens.
Taking time to focus on those blessings helps provide needed context when I am worrying about a possible recession, banking stress, bond yields, inflation, corporate earnings, and the continuing war in Europe.
And by the time Memorial Day comes around in late May, we will have more clarity on:
Each of these events could cause volatility over the coming months, whether we like it or not.
Stocks have proven resilient recently, but if the economic data starts to consistently point towards an economic hard landing, then we should not be surprised if the S&P 500 drops and potentially revisits the recent lows near 3,800.
There are a lot of moving pieces in this market right now, but the most important influence on stocks is economic data, because if the data rolls over hard, it doesn’t matter if the Fed is pivoting – because it’s already too late and the economy is already behind the 8 ball (and that will hit stocks).
This month’s jobs report will be released tomorrow (April 7), on a day the market is closed, but the impact will be felt on Monday because the risks for this report are now two-sided!
So in addition to spending time with family and friends, I will also be focusing on the above issues this weekend because with the S&P 500 above 4000, a hard landing is not priced in, leaving this market vulnerable to a 5% – 10% pullback. My team and I will continue to stand on the wall watching over your portfolio.
Happy Easter.
Our clients rely on us for timely information, and our job is to deliver.
Disclosures
Investment advisory services offered through Robertson Stephens Wealth Management, LLC (“Robertson Stephens”), an SEC-registered investment advisor. Registration does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. This material is for general informational purposes only and should not be construed as investment, tax or legal advice. Please consult with your Advisor prior to making any investment decisions. The information contained herein was compiled from sources believed to be reliable, but Robertson Stephens does not guarantee its accuracy or completeness. Investing entails risks, including possible loss of principal. Past performance does not guarantee future results. This material is an investment advisory publication intended for investment advisory clients and prospective clients only. Robertson Stephens only transacts business in states in which it is properly registered or is excluded or exempted from registration. A copy of Robertson Stephens’ current written disclosure brochure filed with the SEC which discusses, among other things, Robertson Stephens’ business practices, services and fees, is available through the SEC’s website at: www.adviserinfo.sec.gov. © 2023 Robertson Stephens Wealth Management, LLC. All rights reserved. Robertson Stephens is a registered trademark of Robertson Stephens Wealth Management, LLC in the United States and elsewhere.
Securities offered through Fortune Financial Services, Inc. Member FINRA/SIPC. Robertson Stephens Wealth Management, LLC and Fortune Financial Services, Inc. are separate entities and are not affiliated.
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