The H Group Blog

Investment and Financial Planning news from some of the best in the business.

Question of the Week - May 16, 2016

Guest Post - Monday, May 16, 2016

What happened to retail stocks last week?

We don’t often comment on idiosyncrasies of individual sectors from week-to-week as the short-term returns aren’t often that meaningful or are self-correcting, but news here represents a microcosm of broader paradigm shifts in consumer behavior, and one that some economic metrics are having a hard time relaying.

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Weekly Review - May 9, 2016

Guest Post - Monday, May 09, 2016

Summary

  • Economic data for the week was highlighted by continued mixed results in manufacturing, but stronger non-manufacturing/services data. The employment situation report for April was a bit of a disappointment, mostly due to the doubt it casts on Fed action in the near future.
  • Equity markets declined on the week, but domestic high-quality bonds performed positively as interest rates declined. On the other hand, U.S. high yield and emerging market bonds weakened in line with lower oil prices.
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Weekly Review - May 2, 2016

Guest Post - Monday, May 02, 2016

Summary

  • As expected, the FOMC didn't take any interest rate policy moves following their April meeting, while 1st quarter GDP came in a bit lower than expected, manufacturing data continued to show some ongoing weakness, while housing reports were decent.
  • Stocks lost ground on the week globally, not helped by the Bank of Japan's lack of action on the accommodation front. With interest rates falling, bonds gained, led by credit, which was helped by continued recovery strength in energy.
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Weekly Review - April 25, 2016

Guest Post - Monday, April 25, 2016

Summary

  • Economic data for the week was focused on several housing stats, including higher home prices, existing home sales but lower starts and building permits. Jobless claims fell to multi-decade lows, which was good news for the labor market.
  • Stocks rose on the week with decent earnings reports and higher energy prices. Bonds lagged due to higher interest rates.
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Question of the Week - April 25, 2016

Guest Post - Monday, April 25, 2016

Where do we stand with inflation?

We last wrote about inflation in our November 9 blog post, so it’s time for an update. Measuring inflation can be either simple or complex, depending upon what is measured.

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Weekly Review - April 18, 2016

Guest Post - Monday, April 18, 2016

Summary

  • Economic data for the week was plentiful but mixed, with neutral results from retail sales and inflation, weaker industrial production and consumer sentiment but strength in some manufacturing results.
  • Equity markets gained ground with higher oil prices and positive earnings results. Government bonds lost some ground on higher interest rates, but tighter spreads benefitted corporate bonds. Commodities also rallied, led by oil and agriculture.
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Weekly Review - April 11, 2016

Guest Post - Monday, April 11, 2016

Summary

  • In a relatively quiet week for economic data, ISM services showed further improvement into expansionary territory, and some jobs data offered a decent showing, with lower claims and stronger hiring and quits activity in the governments JOLTs report.
  • Equity prices generally fell globally with sentiment for economic growth declining a bit. Bonds rallied upon lower interest rates. Commodities gained, with oil leading the charge as a result of lower inventories.
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Weekly Review - April 4, 2016

Guest Post - Monday, April 04, 2016

Summary

  • Economic data for the week was highlighted by a turnaround in manufacturing, decent housing reports and a generally positive but uneventful employment situation report.
  • Equity markets gained on the week with decent economic data, while bonds also performed well along with a drop in interest rates. Commodities fell on the week as oil supply concerns again rose to the forefront.
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Weekly Review - March 28, 2016

Guest Post - Monday, March 28, 2016

Summary

  • A slow week for economic releases included a slowing in durable goods orders, mixed housing data, and GDP for the 4th quarter of last year that was revised upward slightly from an earlier estimate.
  • Equity markets declined globally as a result of the Belgian terrorist attacks and lower energy prices, while bonds were little changed due to minimal changes in yields during the week. Oil prices fell a few dollars from the prior week.
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Question of the Week - March 28, 2016

Guest Post - Monday, March 28, 2016

In a low yield environment, many investors have been drawn to high-income strategies. What are the risks?

Investment strategies claiming high yields are intuitively appealing to investors, mostly due to the behavioral tendency of large payouts acting as 'a bird in the hand' being worth more than 'two in the bush,' and implying mixed feelings about using total return for portfolio drawdowns. Particularly in an environment of low yields for safe assets like savings accounts, CD's and money market mutual funds, higher yield options have been in strong demand. There's a bit of anchoring here as well, as high yields for certain investments are often compared in relative terms to rates for CD's or government bonds, which provides part of the story, but certainly not all of it.

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