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October 31, 2018

Stocks Finish October on a High Note


Close the Books on a Wild October

US stocks managed to string together two positive trading sessions to finish the month as the tech-heavy Nasdaq surged 2.01%, the S&P 500 rose 1.09% and the DJIA increased 0.97% on the day.  However, observing October in its entirety, the picture wasn’t nearly as rosy for risk assets:

Nasdaq: declined 9.2% - worst month since 2008
S&P 500: lost nearly 7% - worst month since 2011
DJIA: down 5.1% - worst month since January 2016


October 30, 2018

Market Selloff Takes a Break


Stocks Recuperate (Some) Losses

All is well on Wall Street again (at least for today), as stocks were able to maintain steady gains throughout the session.  All sectors within the S&P 500 finished in the black, boosting the overall index by 1.57%, while the DJIA (+1.77%) and Nasdaq (+1.58%) also posted strong gains.  US Treasurys sold off as financial markets shifted into risk-on mode, with yields/swap rates climbing 2-5bps across the curve and the 10-year note yield crossing over 3.12%.  In commodity markets, crude oil extended yesterday’s slide, as...

October 29, 2018

Red October Continues for Stocks


New Week, Same Volatility

US stocks were unable to hold onto the gains experienced in the early portion of the trading session, as the tech and industrial sectors plunged with continued concerns over higher interest rates and trade war uncertainty.  The Nasdaq finished the lowest among the major indices, falling into correction territory (-1.63%), while the DJIA (-0.99%) and S&P 500 (-0.66%) posted more modest losses, helped in part by strength in financials.  US Treasury markets similarly operated in risk-off fashion in the morning before rallying into...

October 26, 2018

Volatility Persists as Stocks Tumble, Treasurys Rally


A Spooky October

Yesterday’s rally in equities proved to be short-lived as major indices tumbled yet again during today’s trading session.  Risk appetite was tempered straight from the open as markets reacted to the sub-par earnings results from tech giants Amazon and Google released yesterday evening.  The tech-heavy Nasdaq finished the deepest in the red (-2.06%) and is now down 11% in the month of October -- on pace for its worst month since 2009.  The S&P 500 (-1.73%) and DJIA (-1.19%) didn’t fare much better and once again have crossed into...

October 25, 2018

Stocks Stop the Bleeding (For Now)


Risk Assets Rebound     

US equity markets were able to reverse a significant portion of yesterday’s losses during today’s trading session as the tech-heavy Nasdaq posted a 2.95% gain to pace the major indices.  Unfortunately, it looks like it may be a red Friday tomorrow for stocks as both Amazon and Google posted disappointing quarterly earnings after the close, pushing their share prices down 8% and 4% in after-hours trading, respectively.  US Treasurys maintained a steady selloff throughout the session, with yields/swap rates climbing 1-3 bps across...

October 24, 2018

RISK OFF! Stocks Plummet, Treasurys Gain


Another Volatile Day

Equity markets experienced another forgettable trading session today as all three major indices gapped lower into the close.  The tech heavy Nasdaq fared the worst, dropping 4.4% (into correction territory) – the index’s largest daily decline since August 2011.  The S&P 500 (-3.09%) and DJIA (-2.41%) didn’t fare much better, as another round of below-expectation corporate earnings and continued geopolitical uncertainty soured investor sentiment.  Overall, October has been a terrible month for US stocks thus far, with the Nasdaq...

October 23, 2018

Stocks, Yields Gap Lower Before Reversing Course Later in Session


Risk Assets on a Roller Coaster

Volatility ensued throughout today’s trading session as the S&P 500 and Nasdaq each declined more than 2% shortly after the open before paring the majority of losses in the afternoon.  The DJIA similarly sold off to begin the day and was down nearly 550 points at its lows in response to equity weakness out of China and Europe, along with weaker-than-expected earnings reports from Caterpillar Inc. (-7.56%) and 3M Co (-4.38%) this morning.  Losses for the day among the major indices were limited to around 0.5% after...

October 22, 2018

Financial Markets Mixed in Anticipation of Corporate Earnings


Earnings in Spotlight

This week equity investors will be getting a full slate of corporate quarterly earnings to evaluate, with 1/3 of the companies in the S&P 500 set to report this week, including tech giants Amazon and Google.  Earnings season thus far has been positive, with 82% of the firms who have reported beating expectations.  Major stock indices were mixed on the day, as the financial sector led the DJIA (-0.50%) and S&P 500 (-0.43%) lower, while the Nasdaq was able to muster a small gain of 0.26%.  US Treasurys continued to trade in a...

October 18, 2018

Stocks Back to Losing Ways as Geopolitical Tensions Build


Market Rundown

Concerns over rising interest rates, increased tensions with Saudi Arabia, and geopolitical uncertainty in Europe drove major stock indices 1.27%-2.06% lower on the day.  The yield on the 2-year Treasury note briefly touched above 2.90% as the momentum from yesterday’s FOMC minutes carried into today’s trading session.  Treasurys rallied back later in the session as investors flocked towards safe haven assets after Treasury Secretary Steven Mnuchin revealed he would not be attending the “Davos in the Desert” conference in Saudi Arabia later...

October 17, 2018

Yields Rise Following Release of Fed Minutes


FOMC Minutes

Today the Fed released the minutes from its September 25th-26th meeting in which the Committee made the decision to hike its benchmark borrowing rate to a target range of 2.00%-2.25%.  The primary areas detailed within the text included:

  • Removal of the phrase “policy was accommodative” from the statement.  The change wasn’t meant to signify that the current level of rates wouldn’t spur growth, rather the Fed would like to reduce the amount of precision conveyed by the Committee.  

  • ...


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