Monthly Market Perspective: May 2024

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What Are Initial Jobless Claims Telling Us? By James M. Walden, CFA Initial unemployment claims have historically been an effective leading indicator of broader economic trends. In fact, initial claims are one of the 10 components that make up the Conference Board’s widely followed Leading Economic Index. For most of the post-pandemic recovery, initial claims…

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Monthly Market Perspective: April 2024

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Still All About Inflation By James M. Walden, CFA Two years after the Federal Reserve’s first interest-rate hike of the cycle, it’s still all about inflation. Much progress has been made to bring inflation down to the Fed’s stated 2% goal. The year-over-year change in the consumer price index (CPI) in March was 3.5%, down…

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Monthly Market Perspective: March 2024

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The S&P 500 Is Expensive By James M. Walden, CFA For the 12 months ended March 10, 2024, the S&P 500 returned 30.4% in total. After such outsized gains, is the S&P 500 a bargain today? We say no. Rather, we think it’s expensive. The price-to-earnings (P/E) ratio is one metric used to determine how…

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Monthly Market Perspective: February 2024

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Employment: What Lies Beneath By James M. Walden, CFA Despite the highest inflation in 40 years and the most aggressive Fed rate-hiking campaign in decades, 2023 turned out to be a surprisingly resilient year for the economy and financial markets. Not only was there no recession, but the GDP growth of 3.1% in 2023 marked…

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Monthly Market Perspective: January 2024

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The Fed Pivot: All Clear for Markets? By James M. Walden, CFA During the Federal Reserve’s December meeting, the central bank forecasted a pivot in its interest-rate strategy. For the first time this cycle, the Fed penciled in rate cuts (three of them) in 2024, making the rate increase in July 2023 likely its last.…

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Monthly Market Perspective: December 2023

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Recession (or a Lack of One) Key to the Path Forward By James M. Walden, CFA It’s that time when Wall Street strategists publish their outlooks for the year ahead. Collectively, they offer a wide range of opinions and, naturally, a wide range of accuracy. We don’t publish forecasts in this traditional sense, but we…

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Monthly Market Perspective: November 2023

Strong Consumer Tailwinds Are Fading By James M. Walden, CFA Robust consumer spending, up 4% in the third quarter, was the driver of this summer’s surge in economic growth. But it appears that tailwinds underpinning consumers are blowing much less forcefully, which calls into question the sustainability of the economy’s surprising resilience. A historically tight…

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Monthly Market Perspective: October 2023

Higher for Longer … for Now By James M. Walden, CFA There was a string of solid economic news for most of the past few months. Core inflation has continued to moderate. GDP growth appears to have accelerated in the third quarter. The Federal Reserve didn’t raise rates at its September meeting. And while it…

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Monthly Market Perspective: September 2023

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Inflation Reacceleration By James M. Walden, CFA Inflation reaccelerated in August. According to the Consumer Price Index, month-over-month inflation in the U.S. jumped to 0.6%, the highest rate in more than a year. On an annual basis, prices were up 3.7%, compared to 3.2% in July. Much of the increase came from higher energy prices.…

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Monthly Market Perspective: August 2023

Earnings Growth Needed from Here By James M. Walden, CFA After slowing in previous quarters, U.S. economic growth reaccelerated in the second quarter—a welcome development, to be sure. That, combined with continued progress taming inflation and hype around artificial intelligence, has contributed to strong gains in the S&P 500 in the year so far. But…

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