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Thursday, May 7, 2020

The eruption of the coronavirus known as COVID-19 caused a rapid market crash reminiscent of 1987. The background causes were different, but the results were similar. The market fell about a third in a short period of time. In 1987,...

 

Thursday, April 2, 2020

When 2019 ended, we thought the market was ripe for a single-digit pullback after a great 2019. Instead, the Covid-19 virus brought the global economy to a halt, first in China and then throughout the globe concentrated in the...

 

Monday, March 23, 2020

Due to the coronavirus pandemic we are now working remotely, effective March 20th. All of our systems are fully functional, and we are able to trade, move money, and perform all our other services. We can still be reached at our direct...

 

Wednesday, March 4, 2020

The equity market pullback that we predicted as likely in our year-end blog materialized rapidly in February. Fear of a global pandemic due to the coronavirus, COVID-19, served as the main spark to the swift fall. The S&P 500 fell 12...

 

Wednesday, January 29, 2020

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Friday, January 3, 2020

2019 was a great year for equities. The S&P 500 ended up 31.49% on a total return basis, the best performance since 2013. It helped that the S&P 500 began the year deeply oversold after falling 13.52% in the fourth quarter of 2018....

 

Friday, November 8, 2019

Third quarter earnings have been mediocre. Reported sales growth as of November 7th is 3.76% while earnings have fallen 1.01%. Certain key sectors such as healthcare and communication services have seen earnings grow nicely, while...

 

Wednesday, October 2, 2019

After a strong rebound from last December’s lows during the first half of the year, the S&P 500 consolidated its gains in the third quarter. The S&P 500 rose 1.19% in third quarter and finished up 18.74% year-to-date....

 

Tuesday, August 6, 2019

The Federal Reserve lowered its Federal Funds Target rate twenty-five basis points on Wednesday to its current target range of 2.0% to 2.25%. The members do not believe we are late-cycle, but in the middle of an economic pause that...

 

Monday, July 8, 2019

Returns for the first half of 2019 were strong for most asset classes. The S&P 500 finished the quarter up 4.30% on a total return basis, while its year-to-date return was 18.54% which represents its best first-half performance in...

 

Thursday, May 16, 2019

The recent increase in trade tensions prior to the arrival of the Chinese Trade delegation to Washington DC led to a four percent sell-off in equity markets from the April 30th closing high. However, the S&P 500 is still up 13.72%...

 

Thursday, April 4, 2019

Equity performance in the first quarter of 2019 turned out to be the mirror image of the steep decline in last year’s fourth quarter. The S&P 500 ended up 13.07%, a bit less than the Russell 2000 smallcap and S&P Midcap 400...

 

Monday, February 25, 2019

The Federal Reserve raised interest rates a quarter of a percent in December taking the target range for the federal funds rate to 2.25 to 2.50%. Last week, the Federal Reserve indicated that the Fed funds rate is now near...

 

Friday, January 4, 2019

Investors relearned in 2018 just how volatile equity markets can be. The year contrasted sharply with 2017 when the S&P 500 moved steadily higher with barely a blip to the downside. 2018 began the year with the S&P 500 shooting 7.45%...

 

Thursday, December 6, 2018

Trade, Interest Rate Risk Temporarily Lessen Federal Reserve Chairman Powell alleviated financial market concerns last week in a speech at the Economic Club of New York. Powell indicated that interest rates were close to neutral, a...

 

Monday, November 5, 2018

Volatility Rises, Correction Likely Near the Bottom The S&P 500 has now experienced two corrections in less than ten months. The uncertainty of the outlook for earnings and revenue growth is a major reason for the volatility. Earnings...

 

Thursday, October 4, 2018

U.S. Markets Outperform in the Third Quarter The S&P 500 rose 7.20% in the quarter, its best quarterly performance since the final three months of 2013. Large cap American stocks were the clear winners as the mid-cap and small-cap...

 

Wednesday, August 15, 2018

Earnings Were Great, Now What? Second quarter earnings reports have been impressive. With slightly more than ninety percent of companies reporting, S&P 500 sales grew 10.1% and earnings grew 25.6% in the quarter according to Bloomberg....

 

Tuesday, July 3, 2018

Trade Concerns Influence Second Quarter After a first quarter with significant upside and downside volatility, the price action on the S&P 500 was relatively tame in the second quarter. The S&P 500 increased 2.93% for the quarter and 1...

 

Wednesday, May 30, 2018

Italy Roils Global Markets Global markets have fallen over the last week in reaction to the political developments in Italy. Initial reports that two Italian populist parties were ready to reach an agreement on a coalition government...

 

Sunday, April 1, 2018

After a strong rally that began when Donald Trump was elected and culminated with a 7.45% rise in January, equity markets sold off in February and March. The S&P 500 declined 10.15% from its all-time closing high on January 26th...

 

Wednesday, February 7, 2018

Volatility reappeared in global equity markets following over a year of easy returns. All the recent volatility has been on the upside, and this correction should serve as a reminder to investors that volatility is a two-way street....

 

Monday, January 1, 2018

2017: A Year for the Record Books Global markets soared in 2017 as equities in the U.S and abroad experienced great returns. The S&P 500 finished the year up 19.42%, yet underperformed many international markets before accounting for...

 

Wednesday, December 13, 2017

Bitcoin is all the rage lately. The price has jumped from about $952 at the beginning of the year to approximately $17,248 as of December 12, 2017 according to Bloomberg, including a spike of over 400% in the last three months. Can...

 

Wednesday, November 1, 2017

President Trump nominated Federal Reserve Board Member Jerome Powell to be the next Federal Reserve Chairman. Assuming he is confirmed, Powell will replace the current Chairwoman, Janet Yellen whose term as chair expires in the first...

 

Saturday, September 30, 2017

Equity Markets Accelerate, Treasury Yields Stabilize The S&P 500 rose for the eighth consecutive quarter climbing 3.96%. The quarterly gains were once again led by the technology and healthcare sectors, while the financial services...

 

Monday, September 11, 2017

The CBOE Volatility Index (“VIX Index”) and the Merrill Lynch Option Volatility Index (“MOVE Index”) are both hovering near their all-time lows. The VIX Index measures volatility in the equity markets, while...

 

Wednesday, August 16, 2017

The S&P 500 is up more than two and a half times since its March 2009 closing low. Many stocks are up even more. The S&P 500 has gone from being very cheap to being fully or overvalued on most historical valuation metrics. Taking some...

 

Monday, July 10, 2017

International Markets Lead Equity Market Rally The S&P 500 posted its seventh straight positive quarter with a 2.57% gain for the second quarter of 2017. The rally brought its year-to-date rise to 8.24%. Domestically, large...

 

Friday, June 16, 2017

The Federal Reserve (“Fed”) raised the Federal Funds rate 0.25% for the third time in the past six months. While the Federal Reserve is in a tightening cycle, it could be argued that financial conditions have not tightened...

 

Tuesday, May 2, 2017

The economic data was on the weaker side in the first quarter with real GDP growing at 0.7% and nominal GDP growing around 3.0% at an annualized rate. Despite the weak GDP data, first quarter sales and earnings are inflecting higher....

 

Monday, April 17, 2017

Equities continued their now 14-month long move higher with the S&P 500 rising 5.53% in the first quarter. Large capitalization stocks led the way, outperforming their small and mid-capitalization brethren. International stock markets...

 

Monday, February 27, 2017

The S&P 500 has rallied 10.65% through February 24th since Donald Trump won the Presidency. The rally has been led by financial service stocks & other economically-sensitive sectors. The strength and relentless nature of the rally has...

 

Monday, January 23, 2017

Stocks Outpace Bonds in 2016 2016 ended up being a great year for stocks, and a so-so year for bonds. However, it was a tale of two halves in financial markets. The first half of the year saw yields collapse in the United States and...

 

Friday, December 23, 2016

Donald Trump will become the forty-fifth President of the United States after a hard-fought campaign. Republicans now control the Presidency and both houses of Congress. Trump is a populist who campaigned on change, and NPP believes a...

 

Thursday, December 15, 2016

The Federal Reserve raised the federal-funds rate target by 0.25% yesterday. The interest rate target is now between 0.50% and 0.75%. This was completely anticipated by the market. The markets were caught off guard by the forecast for...

 

Thursday, October 6, 2016

Third Quarter Financial Markets Calm After a strong start, the S&P 500 spent the remainder of the third quarter trading in a narrow band. It finished with a 3.31% gain for the quarter and 6.08% for the year. Smaller stocks outperformed...

 

Tuesday, August 23, 2016

The economic recovery that followed the Great Recession has been one of the weakest on record. Growth in real GDP comes from two components: an increase in the working population combined with the change in productivity of those...