August 15, 2014 Market Update

With geopolitical events continuing to exert undue influence on the global economy, several of last week’s economic releases—namely, retail sales and the producer price index (PPI)—provide insight into fundamental forces that ultimately determine growth and the direction of interest rates. The retail sales number for July was a disappointment, as the recent gains in employment … Read more

August 8, 2014 Market Update

In a week devoid of meaningful economic data, financial markets were once again led by intensifying geopolitical events. With stock indices across the globe recording losses of 1%-3% on the week, US ten year yields declined to a low of 2.35% on Friday—a new low for 2014 and the lowest such point since June 2013. … Read more

August 1, 2014 Market Update

After months of record low volatility and little directional bias in price, fixed income markets were finally awoken from their summer doldrums, driven by a string of robust economic data. Not to be outdone, equity markets sold off sharply on the data, with the DJIA recording a 317 point drop on Thursday, its largest such … Read more

July 25, 2014 Market Update

Increasing geopolitical tensions, mixed economic data, low volatility, and little directional bias in interest rates; sound familiar? Last week produced more of the same in fixed income, as prices across the entire maturity  spectrum remain in a well-defined (and very narrow) trading range. With a yield of 2.48%, the ten year US Treasury note has … Read more

July 18, 2014 Market Update

The intensifying geopolitical backdrop of Ukraine/ Russia, Israel/ Gaza, and Iraq/ ISIS continued to influence market activity and investment flows last week. As a result, intermediate and longer-dated Treasury rates were able to revisit their low yields of the year, last touched in May. However, the one thematic constant that continued unabated last week was … Read more

July 11, 2014 Market Update

Geopolitical headlines, coupled with renewed stress in European markets, led to a strong rally in US Treasuries last week. Further supporting the decline in interest rates was the perceived dovish overtone to the minutes of the June Federal Open Market Committee meeting. The yield curve flattened yet again, as intermediate and longer dated maturities registered … Read more

June 27, 2014 Market Update

Treasury yields fell across the maturity spectrum last week, with longer dated maturities recording the largest price gains relative to shorter dated bonds and notes. With geopolitical concerns continuing to weigh heavily on investors’ minds, interest rates were propelled lower on the surprising revision to the 1st quarter GDP and the resulting downward revisions to … Read more

June 20, 2014 Market Update

With geopolitical risks abound, financial markets were resilient yet again last week, thanks to the mostly dovish tone struck by the Open Market Committee of the Federal Reserve and its Chair, Janet Yellen. Despite recent economic indicators registering a pickup in growth and inflation, namely CPI, the FOMC reiterated its “lower for longer” theme in … Read more

June 13, 2014 Market Update

The grind toward higher Treasury yields—and June’s bearish momentum in interest rates—persisted through most of last week, only to reverse on Thursday with an escalation in geopolitical concerns, especially Iraq. After reaching a high of 2.70%, 10 year Treasury notes recovered on the selloff in risk assets and closed the week up only 1 basis … Read more

June 6, 2014 Market Update

Treasury yields rose sharply last week, with intermediate and long dated bonds registering the sharpest price declines, as US equities again reached new highs. Friday’s eagerly anticipated May employment report came in line with market expectations, continuing to signal gradual improvement in the labor market. With +217,000 jobs created last month, May marked the first … Read more