![Does this stock market rally of October 2022 have legs?](/uploads/5/7/9/3/57932395/published/legs-gddc602182-640.jpg?1667411260)
While we’re on the topic of good news, consumers expect the inflation rate a year from now to be 5.4%, the lowest number in a year and a decline from 5.75% in August, according to the latest New York Fed Survey of Consumer Expectations.
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David Alan Carter ![]() After the U.S. economy shrank in the most recent back-to-back quarters (by some measures, the very definition of a recession), new data in October showed the GDP grew in the third quarter by 2.6% from a year earlier. That was certainly welcome news, as was the shrinking trade deficit and a job market that remains strong. While we’re on the topic of good news, consumers expect the inflation rate a year from now to be 5.4%, the lowest number in a year and a decline from 5.75% in August, according to the latest New York Fed Survey of Consumer Expectations. ![]() David Alan Carter The month started out swimmingly. The first few days in September saw a promising upswing with the S&P 500 posting a gain of a few percentage points by the 12th. Perhaps investors were giddy with gas prices falling at the pump and demand for real estate beginning to taper. Inflation licked? Not quite. One day later, a hotter-than-expected report on inflation sent the stock market reeling. The Dow lost more than 1,250 points and the S&P 500 sank 4.3%. Bond prices also tumbled, sending yields sharply higher. ![]() David Alan Carter The markets had been on a tear. Driven by modestly positive inflation data that spurred hopes the Federal Reserve would take a less aggressive approach to future rate hikes, the tech-heavy Nasdaq Composite rallied a whopping 20% between mid-June and mid-August. Of course, it was still on the wrong side of its 200-day moving average, and would need to climb another 17% just to break even with the high it made in late November 2021. But it was a heck of a summer rally just the same. The operative word is “was.” ![]() David Alan Carter We all know the duck test. There are variations, but it typically goes something like this: If it walks like a duck, quacks like a duck, and swims like a duck, then it’s probably a duck. So, if it walks like a recession, quacks like a recession, etc., is it a recession? Well maybe, maybe not. ![]() David Alan Carter It’s the mid-year mark, so every news agency that follows business is looking back and making comparisons to this and that. For the reporting class, it’s sport. For investors, it’s pretty glum on the field.
![]() David Alan Carter If you’ve been watching the market every day in May, a masochistic activity I do not advise, Amazon should be delivering your foam neck support brace any time now. May has been characterized by the whipsaw – the movement of stocks in a volatile market when a stock price will suddenly switch direction. It’s been happening at the stock-specific level and to the market in general. ![]() David Alan Carter I was listening to the “oldies” station on satellite coming home last night (when I was growing up, it was just called the “radio” station). Sonny and Cher’s hit song from the late 60s and 70s The Beat Goes On was playing, and for a few precious moments I was transported back to my youth. When the universe returned me kicking and screaming to my present state of affairs, I was reminded of headlines that have been breaking recently. Headlines like... ![]() David Alan Carter The bond market is whispering something to investors. That something is definitely important. Or maybe not. It’s a little hard to tell in a market with more moving parts than the tax code. One thing is certain: this week saw a yield curve inversion. ![]() Putin's War As horrific as any war is, taking an unfathomable toll on individual lives, history teaches that – from an economic perspective – regional battles negatively impact global markets only in the short term (days, weeks). Perhaps it shouldn’t be so, but that’s the reality. Most analysts expect the same as the Russian bear mauls the sovereign nation of Ukraine – that global markets will get back to medium and long term trends in short order, despite the toll in human misery. Of course, all bets are off should the conflict deepen or spread to other countries. |
AuthorDavid Alan Carter, author of the books: Archives
July 2024
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