https://www.gam.gi/wp-content/uploads/2019/06/gamlogo.png 0 0 Mark Maloney https://www.gam.gi/wp-content/uploads/2019/06/gamlogo.png Mark Maloney2022-08-08 17:00:242022-08-08 17:01:39Market Commentary August 2022
After experiencing its worst first-half decline since 1970, the S&P 500 jumped 9.2% in July. Impressive yet depressing at the same time considering how much further it has to go just to get back to breakeven. If you are wondering why stocks rallied, you might conclude that something positive must have happened on the inflation front. Actually, the inflation data reported in mid-July was the worst in 40-plus years. Ditto any positive thought on the economy; Q2 GDP reported late in July was negative, meaning the economy had met the textbook definition of a recession. The market’s ability to shake off the data and finish the month in rally mode likely reflected a few factors. For one, the sky does not appear to be falling on the consumer economy. Lower-income consumers are struggling with reduced purchasing power, but most consumers are benefiting from full employment and rising wages. Equally important, the markets are starting to believe that the Fed’s aggressive action will help contain inflation. Finally, consumers may be learning to live with higher interest rates - particularly if, as some investors now suspect, rates hit a plateau and begin to fall next year.
https://www.gam.gi/wp-content/uploads/2019/06/gamlogo.png 0 0 Mark Maloney https://www.gam.gi/wp-content/uploads/2019/06/gamlogo.png Mark Maloney2022-07-04 12:52:562022-07-04 12:56:48Market Commentary July 2022
The S&P 500 has rebounded over 4% from its 2022 lows. But from a technical perspective, it is far too early to call the bottom. For this we need to see a huge improvement in the percentage of stocks trading above their 200-day averages. Unfortunately for investors seeking to call the bottom, that takes time. Price tends to run away from investors at a bottom, and often you will hear investors say that they will wait for the next pullback that never comes. The market does not let you in but rather just locks the door. News flow at the bottom tends to be terrible and those waiting for the all-clear sign on headlines will likely be disappointed as the market discounts better news in the future. Bad news is bought, which can be confusing to many - especially those that have not been through numerous bull/bear cycles. Generally, stock market lows are found when some type of bottom formation is seen, and the bullish breakout coincides with the break of the bear-market trendline. Quite simply, it’s a succession of higher highs and higher lows.
https://www.gam.gi/wp-content/uploads/2019/06/gamlogo.png 0 0 Mark Maloney https://www.gam.gi/wp-content/uploads/2019/06/gamlogo.png Mark Maloney2022-06-06 13:46:272022-06-06 13:48:23Market Commentary June 2022
After two years cooped up in their homes, consumers have been anxious to get back out and enjoy the travel and services they have been missing. In anticipation of a guest surge, airlines have added routes and flights, hotels have ramped up promotional packages, and restaurants have revitalised their menus for consumers anxious to put aside the home cooking. In a fully employed economy with rising wages, and with savings supplemented by past stimulus and reduced commuting costs, consumers should be more than ready to make up for missed time. But an unwelcome traveller, namely inflation, has booked passage. Many consumers are devoting much of their disposable income to food, fuel, and shelter, leaving scarce resources for discretionary goods and services such as travel and leisure.