IMPORTANT NOTICE :
NEVER trust wiring or ACH instructions sent via email. ALWAYS confirm with the sender by phone or in-person. Cyber criminals are hacking email accounts and sending emails with fake wiring instructions. These emails are convincing, sophisticated, and often appear to come from someone you know or work with. Always independently confirm wiring or ACH instructions in-person or via a telephone call to a trusted and verified phone number. NEVER wire or ACH money without double-checking that the wiring or ACH instructions are correct.
The Weekly Economic & Market Recap
September 21, 2018
Despite trade concerns and softening economies in Europe and China, domestic equity markets have rallied strongly in the third quarter. The DJIA has lifted from 24,271 to over 26,700 since the end of June. The prospect of a 5% to 10% pullback in stocks as we approach the November election cannot be dismissed and some would argue that consolidating recent gains would be healthy from a market standpoint. However, the equity market is not showing any sign of stress from a technical or volatility perspective. In fact, the VIX (a measure of the market’s expectation of 30-day volatility) has been in a trading range between 11 and 15 for the entire third quarter and has been trending lower since the January/February market correction. The capital markets overall are not indicating concern. The spread between high yield bonds and comparably dated U.S. Treasuries remain extremely tight. Typically, ahead of market turbulence we see these spreads widen noticeably. Equities have been very resilient as investors have focused on the strength of the underlying U.S. economy and the lack of a substantial pickup in inflation. The Labor Department reported that initial unemployment claims fell to the lowest level since 1969, which is remarkable considering the size of the civilian labor force has increased by more than 60 million people. The Federal Reserve will appropriately raise rates next week. Barring a change in the Fed’s gradualist approach to normalization, or a geopolitical blowup, it is difficult to foresee a reason for a major shift in investor sentiment. To be clear, there are challenges on the horizon such as Brexit and slower economic growth in 2019, but for now investors are not focusing on these future potential concerns.
Click below to listen to this week's Peapack-Gladstone Bank Market Report as heard on WCBS NewsRadio 880.