Once again today we can attribute market gains to the ramifications of the Fed’s announcement about buying individual bonds, including lower rated issues. Today Fed chairman Powell gently pushed lawmakers to continue to stimulate the economy.
While markets started the day much higher than they finished, they were able to manage gains across the board, again with European and Emerging Markets stocks lagging the most; but then again they weren’t the markets getting propped up by their central banks ;).
Small Caps and Growth stocks were the winners of the day while Large Caps and Low Volatility stocks lagged.
This makes sense given the Fed’s comments pushing to prop up the economy. As I have mentioned, Small Caps are often the first to crash when economic conditions sour, and the first to gain when things start to look better, or at the very least have the head of the Fed ask Congress to help the economy.
On the fixed income side, Junk Bonds continued to see positive performance while other, safer assets, saw small decreases. Right now is a tough time to evaluate fixed income markets (and equity markets!) because rates are already at zero, and the Fed has made it clear they will do what’s necessary to prop up the markets and the economy.
Tomorrow we get to see housing start numbers which could be a market mover and ABM Industries reports earnings.
Reading From Today
Tesla now has the highest market cap of any auto-maker; to which my response is
New perspectives on urbanization
Sales of Amazon Vs. Walmart; chart of stock performance below for reference
Be safe and well,
Nathan
