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Category: Market Insights

BMT Monday Market Insights – March 15, 2021

In this week’s narrative, we discuss the passage of the $1.9 trillion American Rescue Plan. We also review the best-performing stock sectors since the November election, along with the recent correction within the NASDAQ. We then discuss the massive flow of monies into bond funds since 2009, and the meager amount of monies added to stock funds over that same time period. Finally, in light of the February jobs report, we review the employment picture in general, and more specifically, within the Leisure & Hospitality industry.

BMT Monday Market Insights – March 22, 2021

In this week’s Market Insights, we cover last week’s FOMC meeting and what it means for bond yields; recent lackluster consumer spending data that is expected to bounce back as stimulus checks are being distributed; and the benefits to municipal issuer fundamentals from the recent signing of the American Rescue Plan. In our Chart of the Week, we discuss the disconnect between the Federal Reserve’s and investors’ expectations for policy rates through 2023. Finally, we highlight the recent widening in credit spreads but continue to believe an overweight to corporate bonds is appropriate.

BMT Monday Market Insights – March 8, 2021

In this week’s Monday Market Insights, we discuss Johnson & Johnson’s vaccine, the sell-off in tech stocks, and how fourth-quarter earnings shaped up. Our Chart of the Week highlights the resilience of the U.S. housing market throughout the COVID-19 crisis. Finally, we look at how economic activity indicators are trending around the globe.

BMT Monday Market Insights – March 1, 2021

In this week’s Monday Market Insights, we discuss Bitcoin, the recent rise in interest rates, and one area of the market that we believe is being underappreciated. In the Chart of the Week, we dive further into the rise in interest rates and the historical relationship between rising interest rates and stock market valuations. We end with more discussion about how rising interest rates may impact the stock market.

BMT Monday Market Insights – February 22, 2021

In this week’s Monday Market Insights, we highlight the performance of small-cap stocks, examine the FOMC minutes, and review favorable recently released economic data. In our Chart of the Week, we examine the recent decline in COVID-19 cases and the economic and financial market implications going forward. Finally, in the Commentary section, we address the topic of investor complacency.

BMT Monday Market Insights – February 16, 2021

In this week’s Market Insights, we cover equity market performance, the weak labor market and potential for fiscal stimulus, and the recent low in junk bond yields. In our Chart of the Week, we discuss the steepening U.S. Treasury yield curve. Finally, we highlight increasing inflation expectations and monetary policy.

Big Tech: The Road To Underpeformance

Over the last ten years, technology stocks have been the undisputed winner. Whether it’s Apple, Amazon, Microsoft, or any of the mega-cap tech names, investors likely have a bad case of buyer’s remorse holding just about anything else. For context, the tech-heavy Russell 1000 Growth index outperformed the Russell 1000 Value index by about 7% per year on average over the last ten years. This is a 2-standard deviation spread, last seen during the late 1990s. In our opinion, tech’s reign of relative dominance has come to an end…at least for now.

BMT Monday Market Insights – February 8, 2021

In this week’s narrative, we discuss the resumed move higher in the S&P 500, which has now fully reversed the -3.3% decline which it experienced during the final week of January, to reach an all-time closing high. As a follow up to last week’s commentary, we also discuss the decidedly negative turn in the shares of GameStop, and the impact this one stock had on two small cap indices during January. We review S&P 500 estimated earnings trends, and how they have already re-rated higher during the first month of the year. Finally, we examine the sharp increase in commodity prices, as measured by the CRB All Commodity Index, which now stands at a six-year high.

BMT Monday Market Insights – February 1, 2021

In this week’s Monday Market Insights, we discuss fourth-quarter Gross Domestic Product, the FOMC meeting, and earnings season progress. Our Chart of the Week highlights the investor mania in highly shorted stocks. Finally, we look at how President Joe Biden could get his $1.9 trillion stimulus package passed by a 50/50 Senate.

BMT Monday Market Insights – January 25, 2021

In this week’s Monday Market Insights, we discuss airlines, banks, and the sector we believe is most vulnerable to a corporate tax increase. Our Chart of the Week highlights the aggressive investment flows out of the technology sector in recent months. Finally, we look at the sector composition between U.S. and European stock indexes, making the case that the lack of tech exposure abroad may finally become a tailwind to performance.

BMT Monday Market Insights – January 19, 2020

In this week’s Monday Market Insights, we highlight market reaction to the violent protest at the U.S. Capitol, the economic soft patch confirmed by the December employment report, and the amount of stock concentration within individual sectors. In our Chart of the Week, we examine the recent rise in interest rates and financial market implications going forward. Finally, we look at how equity market multiples have impacted performance and future sources of equity returns