Fiera Capital’s Post

We look back over the markets for February. Read our market commentary here: https://bit.ly/46gi3Zq #SVNCapital #MarketCommentary #InvestIntelligently

Great to kick off the new year at Bloomberg Markets Today last week, reflecting on the December bond rally and where this leaves markets – which are pricing aggressive rate cuts from the #fed but have started to scale these back in terms of magnitude and timing. I also discussed opportunities for positioning, given significant levels of cash still on the sidelines. Average cash allocations in European wealth portfolios went from 3% in 2021 to 8% in 2023 (source: BlackRock Portfolio Consulting, December 2023), and almost US$2T went into money market funds globally last year, largely driven by US investors (source: Bloomberg, January 2024). While that figure includes changes in the vehicle of choice for cash, and we started to see money being put to work in December across US, European and emerging market equities reflected in record monthly flows into equity ETFs in these categories, there is still a wall of cash to potentially be invested in 2024. This risk appetite backdrop along with more bullish views across street research are two differences for the start of 2024 vs. start of 2023 that I think will matter this Q1. #2024outlook #risktaking #cash #cash2work #markets #ETFs #assetallocation

Equities are moving lower while bond yields rose after the latest inflation reading raised some concerns around accelerating prices. While most of this morning’s figures came in as expected, markets seem to be focusing on the only one that did not. Investors are looking at the core month-on-month reading which came in at 0.3%, above the expected 0.2%, as a sign that inflation still isn’t completely under control. Yields are now higher across the curve, with the policy sensitive two-year note leading losses, now up by roughly 5 bps to 3.65%. Although markets are still expecting the Fed to begin cutting interest rates next week, the more hawkish members of the FOMC will likely argue against a half-point cut.

Alright, so what did we learn today? We learned that the technical levels in the equities hit some major resistance and a few accounts took this as a rational reason to sell and take some profits. Now all things considered, the markets have had a massive run so this does not surprise us. It doesn’t change things too much, one day does not make a trend, but what it does is, is it puts a minor dent in the pristine image the equities have had over the last 7 weeks. listen to our latest and check out our charts and data while you listen. https://lnkd.in/eCNU-NhJ

Investor hopes for a so-called soft landing catalyzed a profound rally across both stock and bond markets in May. Notably, data showing that economic momentum is finally fading in the United States added to evidence that restrictive monetary policy is working to cool the economy – while some tentative signs that the disinflation process hasn’t completely stalled-out saw investors brace for Federal Reserve rate cuts later this year. Here are the top 4 things to watch this month according to Candice Bangsund, Vice-President and Portfolio Manager, Global Asset Allocation. Our Global Asset Allocation team’s full June market update is available here: https://lnkd.in/eRdrNrm7

Equities around the world are rallying this morning as the Fed’s 50 bps rate cut boosted investor sentiment. This is a shift from yesterday when North American equity markets posted small losses. Following the announcement, investors became concerned that the jumbo cut may have been made due to more weakness in the U.S. economy than previously thought. Those initial concerns around the U.S. seem to be retreating for now as markets gain confidence that a soft-landing can be achieved. 

How are investors supposed to make sense of a market that’s constantly changing due to an endless supply of Fed-related uncertainty? Help your clients better understand how these market complexities could impact their bond portfolios.

Despite pushing higher last week, markets in 2024 thus far can best be described as subdued. This may not be too much of a surprise after a very strong rally in the last few weeks of 2023. Thus, we generally expect some period of consolidation or even a pullback would be a natural and perhaps even a healthy reset for financial markets. However, with the S&P up modestly, even the pullback has been muted and not particularly eye-catching for most investors. In our latest Weekly Market Wrap, we discuss three datapoints to watch as markets get through a bumpy January. https://ow.ly/jI6H50QtfKU

Meandering, Pending Cuts🔍- by Alex King At some point soon, the Fed might join the global rate-cut cycle. The big question: what wins? Q3 seasonality in an election year, which means, probably equities struggle into October or so; or, order flow driven gains in equities as cash comes out of money market accounts (as the return on offer there will fall) and back into equities? For now, most equity charts are pointing up. #IWM #SPY #QQQ #Ratecut #MarketOnOpen 📈📊📉Tuesday 16 July Read more: https://lnkd.in/dsKjgnrT

An interesting Bloomberg article if you are long-term investors : "It’s Dangerous to Stay Out of Stocks" "This is possibly the most important “money chart,” showing the total range of returns for different asset classes in the US since the Barclays data starts in 1925. Over short periods, it confirms that equities can inflict really serious losses; the greatest on record have been worse than for bonds and equities. But the longer term is your friend. Over no 20-year period since 1925, a span that includes both the stock market crash of 1929 and the global financial crisis of 2008, have equities failed to beat inflation. That cannot be said of any other asset class."