Insights

Market volatility continued last week as global markets tried to digest a slew of earnings reports and economic updates. Likely the biggest release was the U.S. GDP report for the first quarter, which showed the U.S. economy contracted by an annualized 1.4% over the first three months of th …

Corporate earnings comparisons are getting more difficult. Factset reports first quarter S&P 500 earnings are expected to rise 4.5%. Earnings growth will likely increase during the quarter as companies deliberately push earnings estimates lower so they can produce positive surprises. Wh …

Initial jobless claims reached their lowest level since September 1969. Continuing claims fell to 1.35 million and reached their lowest level since 1970. The labor force was half as large then as it is today. Concerns about inflation, excess demand, and uncertainty about Russia’s attack on …

The Federal Reserve both met expectations and surprised investors at the same time last week. As expected, the Fed raised rates 0.25%, beginning to unwind the sharp rate reductions it implemented to protect the economy during the early stages of COVID-19. The surprise was the announced inte …

Inflation continued to bound higher last month. The Consumer Price Index (CPI) climbed 0.8% last month and is 7.9% higher than one year ago. The big culprits were food and energy. Food prices leapt 1% last month and gasoline prices increased 6.6% as part of an increase in overall energy pri …

Concerns the Russian invasion of Ukraine will draw more countries into the conflict raised risk and pushed global markets lower. Statements about nuclear forces going on alert and world leaders discussing a no-fly zone concerned investors.

Equity markets wrapped up a volatile week with a late-Friday surge that pushed the S&P 500 to a 0.8% gain. Each day last week experienced a swing of at least 2.25%. Ongoing concerns about interest rates, inflation, valuations, and geopolitical challenges are contributing to swings in the market.

We’re in a pretty interesting juncture in the markets. As we kick off the third year of the COVID-19 pandemic, the omicron variant is spreading across the country.

Equity markets have given back some of last year’s gains. Higher interest rates appear to be the major cause. As the Federal Reserve prepares for its first meeting of the year, investors have raised the odds of four interest rate hikes to approximately 70% from less than 30% one month ago ( …

Inflation remains a challenge to the U.S. economy. CPI rose 0.5% in December and surged 7.1% during the last year. It wasn’t all food and energy prices. Core inflation, which excludes those more volatile elements, increased 0.5% as well. As the bright blue line in Figure 1 shows, inflation …