Cognitive Dissonance? I Don’t Think So – Just Disconcerting
April 29, 2024 Good morning, You could hear the collective sigh of relief in most markets Friday morning as the PCE Price Index (Personal Consumption Expenditures) increased +0.3% in March, about the same as February, and matching the consensus estimate (most importantly). It was an all-clear sign, early Friday morning, for equities to price in Microsoft (MSFT) and […]
Sticky Here, There, and Everywhere
April 25, 2024 Good morning, We will assume this month’s steep sell-off is only a correction until the technical damage begins to invade the medium- and longer-term market indicators. Thus far, there has been plenty of technical damage from all the selling, but it has been contained in the short-term indicators. In fact, short-term sentiment […]
Yields Over Earnings
April 22, 2024 Good morning, For equities this morning, there isn’t much to add to last Thursday’s Morning Note, except that the pullback in prices has continued. The S&P 500 Index (SPX) was down -3.05% last week and broke the next threshold level of -5%. By definition, a “Correction” is >-5%. The SPX has now retreated -5.4% from […]
History’s Divergent Record On Pullbacks
April 18, 2024 Good morning, Finally, an equity market pullback. Almost on cue, as the 2nd quarter got underway and investors had been enjoying 5 months of historically low downside volatility, the S&P 500 Index (SPX) began its overdue pullback. It has not endured a -3% pullback (a minimum threshold by definition) since 10/27/2023 – […]
More Volatility Likely Ahead
April 15, 2024 Good morning, With Futures up ~0.6% in premarket trading this morning, it seems increasingly clear that Friday’s reversal in most asset trends (stocks sold off / bond yields declined) represented broad market risk reduction ahead of the widely-discussed Iranian attack. With the attack over, a partial snap-back of Friday’s outsized moves may be […]
Restrictive Rates Appear To Be Lingering For Longer
April 11, 2024 Good morning, “That sound you just heard was the door slamming on a June rate cut by the Fed” – 8:31am. Yesterday’s quote of the day, moments after the Consumer Price Index (CPI) headline data crossed the tape. The inflation data came in hotter than expected. Bond yields shot higher (up 20+ […]
Weak MN -It Happens
April 8, 2024 Good morning, Following another stunningly strong employment report on Friday morning, stocks rallied to recover most of the losses they had suffered earlier in the week, while bonds continued to fall (higher yields). On the week, the S&P 500 Index fell only -0.95%, the U.S. Treasury 10-yr yield rose 20 basis points from […]
Will Interest Rates Stay Higher for Longer?
By John Lau May 1, 2024 – One of the narratives that has fueled the rally in risk assets since the October 2023 lows is the expectation for interest rate cuts by the Federal Reserve. The only issue here is that most recent statistics surrounding inflation, employment, and broader business activity continue to indicate a […]
March 2024 Monthly Letter
The following is your March 2024 Robertson Stephens Monthly Performance Report. As you can see below, March put a nice closing touch on the first quarter of the year (YTD column). As mentioned, the prevailing sentiment among market strategists is now one of surprise. It was the rare strategist (none that I saw) who called […]
Just A Little Turbulence
April 4, 2024 Good morning, The equity market has experienced a little turbulence over the past few days, down ~ 1% from its highs since last week. It would appear that after two months of ignoring spiking yields in the bond market, (the UST-10yr, for example, has moved from 3.80% to 4.37%), equities may care […]
Grinding Higher
April 1, 2024 Good morning, Welcome to Q2. The overwhelming feeling this morning for investors, and particularly for professional market strategists, is one of surprise. Despite the unusually wide range of market expectations among the “Year Ahead” forecasts last December, I do not recall a single outlier that expected a gain of over 10% by the S&P […]
A Growing Concern For The Fed Chairperson
March 25, 2024 Good morning, As mentioned, the Fed certainly carried the week last week, by announcing Wednesday afternoon that it was leaving its dot-plot unchanged at 3 rate cuts before year-end, and surprising markets with its overall dovish tone. After two flat weeks in a row, the S&P 500 jumped up +2.29% last week. […]