Category S&P500

Navigating Market Volatility, Tariffs and Recessionary Signals Navigating Market Volatility, Tariffs and Recessionary Signals

Navigating Market Volatility, Tariffs and Recessionary Signals

Despite the welcomed relief rally - stocks are not out of the woods. The uncertainty introduced from Trump has inflicted a lot of damage. Not only on the market and its earnings - but on investor, consumer and business confidence. However, the full extent of the damage will only be felt in the months (years) ahead. For example, Bankim Chadha of Deutsche Bank has reduced his target for the S&P 500 for the year, citing doubts over whether tariff policies will be abandoned before they have already driven the economy into a recession. This echoes what I said recently "we could already be in recession"

Trump’s Push for Lower Rates: Why the Bond Market and a 60% Recession Risk Stand in the Way Trump’s Push for Lower Rates: Why the Bond Market and a 60% Recession Risk Stand in the Way

Trump’s Push for Lower Rates: Why the Bond Market and a 60% Recession Risk Stand in the Way

Trump is demanding the Federal Reserve lower rates. However, Fed Reserve Chair Jay Powell - is having none of it (and nor should he). This is setting up another showdown between the President and the world's top central banker... a repeat of what we saw in 2018. As we all know Trump is a real-estate guy. Property is a business that relies heavily on cheap money. And this is the same lens Trump is taking with respect to his growth agenda. But he may not get what he wants...

Navigating Market Panic: What Surging Bond Yields and Peak Fear Tell Us Navigating Market Panic: What Surging Bond Yields and Peak Fear Tell Us

Navigating Market Panic: What Surging Bond Yields and Peak Fear Tell Us

It's very difficult to know if we're at or close to a market bottom. They rarely occur over the space of weeks - it generally takes months. But I cannot predict when (or what) the bottom will be. However, I think the ~20% correction from the market high (6147) to the low (4834) tells me a large portion of the selling is behind us. For example, we're now starting to see equity exposure significantly reduced and cash levels raised. This is a good sign... as there are a lot less people to sell.

Buying Peak Fear: Why a VIX Above 45 is a Rare Long-Term Opportunity Buying Peak Fear: Why a VIX Above 45 is a Rare Long-Term Opportunity

Buying Peak Fear: Why a VIX Above 45 is a Rare Long-Term Opportunity

It's official... the stock market is now 'on sale'. Panic selling has set in with the VIX trading above 45 - something we have only seen 7 times over the past 25 years. For those who resisted chasing extreme valuations the past 12 months - your patience has been rewarded. Valuations have come down. In turn, the longer-term risk reward is now more attractive than what it was only a couple of months ago. But these are rare times. For e.g., it was the only third time this decade that the S&P 500 shed more than 10% in two days.

Navigating Corrections: Valuation Anchors and the Margin of Safety Navigating Corrections: Valuation Anchors and the Margin of Safety

Navigating Corrections: Valuation Anchors and the Margin of Safety

From the moment Trump announced his blanket 10% tariffs in addition to so-called "reciprocal levies" - it's been an exodus from risk assets. The selling was immediate and sharp - something we've not seen since the pandemic five years ago. However, as I will demonstrate, there could be more to come. And from mine - further sharp selling could set up a great buying opportunity for long-term investors.

How to Value Quality Stocks When Market Uncertainty Peaks How to Value Quality Stocks When Market Uncertainty Peaks

How to Value Quality Stocks When Market Uncertainty Peaks

It doesn't take much these days to knock investors off balance. This week it was Trump's 25% on auto tariffs and a slightly hotter-than-expected inflation print. Tariffs are inflationary... a tax on the consumer. And with (services) inflation remaining stubborn... it gives the Fed very little wiggle room to cut rates. In combination with various geopolitical developments and aggressive government spending cuts from the Department of Government Efficiency (DOGE) - this has pushed policy uncertainty to its highest levels since late 2020.

The 2025 Growth Scare: Valuations, Retail Warnings, and the Reality of Stagflation The 2025 Growth Scare: Valuations, Retail Warnings, and the Reality of Stagflation

The 2025 Growth Scare: Valuations, Retail Warnings, and the Reality of Stagflation

Feb 15th I asked this question: "Ready for a Growth Scare?" Markets were yet to correct at the time... however fast forward ~5 weeks and the growth scare has arrived. Now investors are taking notice. The Fed warned growth is likely to slow this week - where Chair Powell said economists outside of the central bank have generally moved up their estimated chance of a recession. The Fed downgraded its economic growth outlook while raising its inflation projection. They see the U.S. economy growing at a 1.7% pace this year, down 0.4 percentage points from what it forecast in December.

Consumer Confidence Sinks: Be Wary of this Market Bounce Consumer Confidence Sinks: Be Wary of this Market Bounce

Consumer Confidence Sinks: Be Wary of this Market Bounce

It was a roller-coaster week for stocks... maybe a hint of things to come? From mine, in the very short term, markets were deeply over-sold looking at its Relative Strength Index (RSI). Often when you see the RSI below a value of 30 - buying isn't too far away. The last time stocks sank ~10% over a few days was 2020. However, in the absence of any crisis, generally this will see both short covering and/or bargain hunting. The bigger question is whether stocks can follow through? I don't think we draw that conclusion yet...

Macro Volatility: Navigating Policy Disruption and Recession Macro Volatility: Navigating Policy Disruption and Recession

Macro Volatility: Navigating Policy Disruption and Recession

Fasten your seatbelts - things could get bumpy. Trump has amplified the seeds of worry stating he was willing to work through a "bit of disruption" - as it will lead to longer-term gains. And whilst a recession was not on anyone's bingo card last month - those probabilities are increasing.

The Tariff Trap: Navigating Market Uncertainty and the Folly of Forecasting The Tariff Trap: Navigating Market Uncertainty and the Folly of Forecasting

The Tariff Trap: Navigating Market Uncertainty and the Folly of Forecasting

Approx 2 months ago - it felt like markets were starting to hedge their bets. How could I tell? Whilst the market was trading near record highs (around 6100) - momentum was fading. I commented on both the weekly MACD and RSI falling - whilst prices remained high. Technicians call this "negative divergence". Quite often it suggests prices are at greater risk of easing. Since then they've dropped ~6%. The week ending March 7th was the worst week for the year and the third straight week of losses... more to come? I think so...