Fed’s “footnotes” in yesterday’s minutes from the September meeting worry markets
Reading the fine print is good advice when it comes to minutes from meetings of the Federal Reserve’s Open Market Committee too. So far today, October 18, the financial markets are in a slight retreat because of notes released yesterday along with the minutes of...
What’s the opposite of a “Goldilocks” market?
A Big Bad Wolf market? A Sauron market? An Evil Stepmother market? The reaction to this morning’s inflation report suggests me might need a name for this kind of market. The worry, my worry, going into today’s Consumer Price Index (CPI) inflation report...
Tomorrow’s inflation numbers are important after today’s rout
At 3:30 p.m. New York time the Dow Jones Industrial Average was down a big 2.39% or 632 points. The Standard & Poor’s 500 was lower by 2.55%. The NASDAQ Composite Index fell 3.16%. (The S&P 500 closed down 3.29%. The Dow was lower by 832 points or...
Bond market takes a bite out of stocks today
The yield on the 10-year Treasury rose another basis point today, after climbing yesterday, to 3.19%. The yield on the 2-year Treasury climbed to 2.88%, up 4 basis points. A lower than expected report on initial claims for unemployment helped fuel the climb in yields....
Mortgage rates and odds of December interest rate increase climb after Fed meeting
Yesterday meeting of the Federal Reserve’s Open Market Committee ended with the committee raising the short-term Fed Funds benchmark rate 25 basis points and signaling an intention of raising rates again in December and then three more times in 2019. Yesterday...
Fed raises interest rates, locks in December increase, signals 3 moves in 2019
No surprise on a September interest rate increase from the Federal Reserve today–but some very aggressive signals on policy into 2019. The 25 basis point increase today raised the Fed Funds rate to a target of 2% to 2.25%. The economy remains solid; Â job growth...
Oil is a story today, but Treasury market is “the” story
Oil prices are up again this morning with the U.S. benchmark West Texas Intermediate ahead 0.21% to $72.23 a barrel as of noon New York time. International benchmark Brent has gained 1.02% to $82.03 a barrel. But “the” story today, I’d argue, is the...
Battle over bond yields, interest rates shifts to 2019
Remember back at the beginning of 2018 when bond investors and traders couldn’t agree on whether the Federal Reserve would raise interest rates two times, or three times or four times in the year? (It wound up being four.) Well, we’re looking at a replay...
My “best-estimate” scenario for the U.S. stock market for the next 60 days
Let’s start with a perhaps less obvious question: Why 60 days? Because that will take us through the historically volatile months of September and October (when fear can beget fear) to the middle of November, which historically tends to mark a turn in the...
Good August jobs number cements Federal Reserve interest rate increase in September (and probably December)
The U.S. economy added a net 201,000 jobs in August. That was above the projection of 187,000 from economists surveyed by Briefing.com. Government statisticians revised the July job gains to 170,000 from 153,000. The official unemployment rate remained at 3.9%. So why...
Is Spain most exposed developed market to emerging market woes?
In the Greek debt crisis it was relatively easy to track the exposure of national financial markets and banks to the crisis. The big issue was what non-Greek banks had bought the biggest share of Greek government bonds. In the current emerging market crisis,...
Emerging market crisis pulls in India, Indonesia
The bad news is that the emerging market crisis that has sent financial markets plummeting in Argentina, Turkey, and Brazil has added India and Indonesia to its list of victims. The good news is that the inclusion of India and Indonesia is exactly what analysts and...
It’s back–the emerging market crisis that shook global markets just two weeks ago
Remember that emerging market crisis that whacked 10% out of the iShares MSCI Emerging Markets ETF (EEM) between July 31 and August 15–and even produced some anxiety in U.S. markets as the Standard & Poor’s 500 fell 2.1% from August 7 through August...
Core consumer inflation climbs at a 2.3% annual rate in July numbers
Granted the Federal Reserve watches the Personal Consumption Expenditures Index to measure inflation, but the big jump in the July Consumer Price Index should remove the last doubts (if any remain) about a September interest rate increase from the Fed. The headline...
Is 10-year yield above 3% finally here to stay? U.S. Treasury raises targets for debt sales in second half of 2018
Yesterday the Treasury Department said that it will raise long-term debt issuance to $78 billion this quarter. That would be an increase from the $73 billion in sales last quarter and the third consecutive quarterly increase. The increased sales of Treasury debt are...
Fed statement today cements September interest rate increase
Today Federal Reserve left its benchmark interest rate at 1.75% to 2.00% and described the U.S. economy in terms that make an interest rate increase at the central bank’s September 26 meeting a virtual certainty (absent some startling news event). The CME...
4.1% GDP growth isn’t enough to make stock market happy
U.S. GDP (in real terms) grew at a seasonally adjusted annual rate of 4.1% in the second quarter. The economy hasn’t seen 4% growth in the memory of most Wall Street analysts (who do, I admit, have short memories), but it still wasn’t enough. Economists...
Is a dip in home sales a “canary in a coal mine” for economy?
Existing home sales fell 0.6% month-over-month in June to a seasonally adjusted annual rate of 5.38 million. The consensus among economists surveyed by Briefing.com called for an annual rate of 5.45 million units. The May sales rate was revised down to a 5.41 million...
Dollar falls as President Trump criticizes Federal Reserve policy again
For a second straight day President Donald Trump has tweeted out criticism of the Federal Reserve’s policy decision to raise interest rates. In his tweets today the President wrote: “China, the European Union and others have been manipulating their...
The good news in the bad news of today’s jobs numbers
You ‘ve got to remember that at this point in the Federal Reserve cycle good is bad and bad is good. So, by itself the good news in the June jobs report this morning would be counted as bad news. The economy added 213,000 jobs in June, well above the 195,000...
My baseline U.S. stock market scenario for the next 30 days
So much negative uncertainty from big possible events. Such strong short term earnings fundamentals. How will these all balance out? Before I get to my take on the answer to that question let’s take a brief stop to look at what a baseline scenario is and why...
As expected, the Fed raises interest rates; as suspected, the Fed signals 4 increases in 2018 instead of 3
No surprise here: The Federal Reserve raised its benchmark short term interest rate by 25 basis points to 2% today from 1.75%. It was the second interest rate increase of 2018. But the Fed also signaled that it was more likely to raise rates two more times in 2018 for...
Moving on: With North Korea summit done, markets focus on Central Bank Week
The summit between U.S. President Donald Trump and North Korean dictator Kim Jong Un produced nothing of import, apparently meeting financial market expectations for “much ado about nothing,” and all eyes on Wall Street have shifted to what I’m...
An interest rate sign of our times–3% on a CD
So there I was, minding my own business, walking down Broadway in my neighborhood, and what do I see in the window of a local bank: An offer for 3% on a five-year CD. Now this wasn’t in the window of one of the megabanks that dominate this sector in New York....
U.S. economy adds 223,000 jobs in May; odds of June interest rate increase bounce back
The U.S. economy added 223,000 jobs in May, well ahead of the 190,000 gain expected by economists surveyed by Briefing.com Revised figures for April showed the economy adding slightly fewer jobs, a revised 159,000 new jobs versus an initial 164,000. The official...
Here we go again on the euro: The bad news is that Italy’s financial crisis is political
The Dow Jones Industrial Average was down as much at 505 points today–before rallying to a loss of “just” 391 points or 1.6%–on fears that a crisis in Italy could once again put the entire EuroZone project in danger. Italian stocks were down...
Federal Reserve minutes to the rescue
The release of the minutes from the Federal Reserve’s May meeting turned markets from red to green this afternoon. The day had started off with just about everything in retreat on an avalanche of disquieting news. President Donald Trump seemed to back away from...
10-year Treasury yields hit 3.1%; is the bond rout accelerating?
Not so long ago global cash seeking safety and liquidity was keeping the yield on the 10-year Treasury at 2.95% in spite of the huge budget deficit resulting from the December Tax Cuts & Jobs Act and the flood of bond sales by the U.S. Treasury and the prospect...
Fed leaves interest rates unchanged, seems to signal continued gradual interest rate increases for rest of 2018
As expected by the financial markets, the Federal Reserve left interest rates unchanged at today’s meeting of the Open Market Committee. As expected the Fed didn’t really clarify its stance on inflation and interest rate increases, acknowledging that...Jim’s Daily Email Alerts:
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