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Investment Perspectives

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Investment Perspectives is a monthly publication which provides our market outlook as well as insight into the state of the economy.

IP-Header.JPGThis month’s issue features the following topics:

“Synchronicity" by Mark Luschini

It’s our view that synchronous global growth will remain in place for the remainder of 2017 and will persist in 2018. The Organization for Economic Cooperation and Development (OECD) composite of leading economic indicators (LEI) for its 35 member countries posted its highest reading since 2014, and the percent of countries with LEIs above levels typically associated with improving growth is the highest in six years.

“Lowflation Still in Control - For Now” by Guy LeBas

As we put pen to paper, it’s been about two weeks since the Federal Reserve announced it would start paring back its massive balance sheet, but skipped out on a rate hike at their September meeting. The official defense—there was a time when a policy decision didn’t have to be defended—at Janet Yellen’s press conference was that inflation is just too low to raise interest rates at the moment, but that as we become confident in approaching 2% (maybe December?), it’ll be time to go again. Even though the labor markets have been performing well, lowflation justified holding off. That defense underscores the Fed’s (some would say) impossible double commitment to both holding inflation steady and encouraging “full employment.” Snarky tone aside, however, our major task isn’t to criticize policy, but rather to help investors understand what the Fed may do and how that will (or might) impact their fixed income investing portfolios.

“September to Remember" by Greg Drahuschak

Once again, the stock market ignored a traditional season bias. Investors entered the traditionally worst month of the year for the stock market with a defensive bias, but after a downside-biased first week, September ended with the S&P 500 gaining 1.93%. Ten of the S&P 500’s 11 sectors ended higher for the third quarter. Only the staples sector ended the quarter lower. The tech sector topped all others for the quarter. Energy was second.

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