By: BCM Investment Team
February’s retail sales losses were more severe than expected with sectors following a familiar pattern but have still managed to grow year-over-year. Manufacturing also felt the effects of last month’s freezing temperatures and underperformed expectations by over 3%. Housing prices meanwhile continue to soar in a trend that looks primed to continue as supply runs worryingly short. A $1,400 stimulus check may not make much of a dent in a down payment, but is it doing much good in a savings account? The 10-year UST yield hit a fresh 13-month high ahead of the Fed decision which Bank of America called “one of the most critical events for the Fed in some time” this week, inching closer to the 2% yield many fund managers believe could spark a 10%+ correction in equities. And what lies ahead on the international stage as commodities, EM exports, and new waves of Covid all climb higher?
Invesco QQQ Trust (QQQ) are both selling off as of 1 PM EST.
Stocks, especially tech stocks, are getting spooked once again with the 10-year Treasury yield breaking to new highs after last Friday. The 30-year rate jumped to 2.428% meanwhile, its loftiest level in nearly a year and a half. Higher rates are damaging to the value of future cash flows, which puts growth-oriented companies at a disadvantage.
Wednesday is also an important day for investors and traders, as the Federal Reserve will detail new economic and interest rate projections, which may suggest Fed officials could raise rates as soon as 2023, given the recent developments with the vaccine rollout and declining coronavirus infection rates in some states.
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NIFE seeks investment results that track the Indxx US Fallen Knives Index. The fund, under normal circumstances, invests at least 80% of its assets in the securities that comprise the index.
The index is designed by Indxx, LLC to consist of U.S. equity securities that have experienced considerable share price declines over the prior year and have financial health, suggesting that the security has potential for share price recovery in the future. Thus far in 2021, NIFE is up about 15%.
NIFE can also offer exposure to a value comeback. While many investors have fled the growth-fueled equities that have powered the bull run, NIFE looks at companies that may have fallen as of late, but still have the financial wherewithal for future gains.
March 17, 2021
After dropping earlier in the session, stocks and index ETFs spiked briefly after the Federal Reserve meeting release Wednesday afternoon, which revealed that the central bank plans to maintain low interest rate levels and bolster the economy as necessary.
“The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals,” the press release said.
Investors and traders had been anxiously awaiting the Fed meeting with Federal Reserve Chairman Jerome Powell this week, leaving markets on edge and tilting lower, after climbing higher in recent days.