Good morning, been a while since I posted. Hope this is worth the wait.
1. Even safe stocks are mixed, with 10 of the 20 largest capitalization stocks higher. 2. Momentum stocks (a.k.a. new economy stocks) are lower, having fallen for the past week. This implies weakness in the future for our U.S. economy based on the movement of stock prices. 3. Interest rates are significantly higher. The 10-year is not only above 4%, but it is approaching 4.17%. The 10-year US Treasury Note traded at a high of 5% in 2023. This does make bonds less expensive, and it raises interest rates in the 'real' economy for things like residential and commercial real estate loans. The 5-year U.S. Treasury Note is trading at 4.08%, and also has a recent high of around 5%. This rate drives automobile loans. 4. Economic news has been a mix of good and bad. Bank earnings showed delinquencies and rising credit costs. This is a very bearish sign. There has also been announcements of business downsizing and layoffs. On the other side, U.S. inflation continues to moderate, the U.S. labor market continues to be strong, and U.S. retail sales have maintained their momentum and growth.
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Stock Market BLOGJeffrey CohenPresident and Investment Advisor Representative Archives
January 2025
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