10-year yield
Stock Market Today: Ukraine Talks Bring Out the Bulls
Fresh signs of at least the potential of a resolution in Eastern Europe whetted risk appetites Tuesday, even as the ominous 2-10 yield curve came even closer to inverting.Â
During the latest round of talks with Ukraine today, Russian Deputy Defense Minister Alexander Fomin said his country’s military would “drastically” remove its military presence from Kyiv. That triggered another day of buying from investors, who weren’t deterred by a U.S. official’s skeptical comment to news outlets that Russia’s moves indicated “a redeployment, not a withdrawal.”
- SEE MORE The 22 Best Stocks to Buy for 2022
Wall Street also wasn’t put off by a potential inversion of the two- and 10-year Treasury rates â “potential” being the key word, as various data sources conflicted on whether the two-year’s yield merely equaled the 10-year yield or surpassed it.
Even then, Lauren Goodwin, economist and portfolio strategist at New York Life Investments, warns against using a yield inversion as an egg timer.
“While curve inversion has historically been an important market signal of recession risk, it does not tell us much about when recession might likely occur,” she says.
Sign up for Kiplinger’s FREE Investing Weekly e-letter for stock, ETF and mutual fund recommendations, and other investing advice.
Real estate investment trusts (REITs) including mall operator Simon Property Group (SPG, +4.8%) and Public Storage (PSA, +3.4%) enjoyed the biggest gains Tuesday, with the sector up 2.9% to lead the S&P 500 (+1.2% to 4,631). The Nasdaq Composite had an even better day, up 1.8% to 14,619, while the Dow Jones Industrial Average recorded a 1.0% gain to 35,294.
YCharts
Other news in the stock market today:
- The small-cap Russell 2000 roared ahead by 2.7% to 2,133.
- U.S. crude oil futures retreated 1.6% to end at $104.24 per barrel.
- Gold futures fell 1.4% to settle at $1,912.20 an ounce.
- Bitcoin slid 0.5% to $47,720.70. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m.)
- Shares of Robinhood (HOOD) spiked 24.2% after the financial services platform said it extended trading hours for clients. Customers on HOOD’s platform will now be able to trade between 7 a.m. through 8 p.m. ET, giving them an additional four hours. This big upside move put a dent in HOOD’s year-to-date deficit. Heading into today, shares were down nearly 28% for the year-to-date.
- FedEx (FDX) gained 3.7% on news Fred Smith will step down as CEO, effective June 1. Smith has been overseeing the delivery giant since he founded the company in 1973. He will be succeeded by Raj Subramaniam, current president and chief operating officer of FedEx. “We anticipate a seamless transition as FedEx appears to have been grooming Mr. Subramaniam to be the company’s next CEO,” says Oppenheimer analyst Scott Schneeberger (Perform). “In recent years Mr. Smith appeared to have been ceding an increasing amount of operational and investor-facing responsibility to his top reports, particularly Mr. Subramaniam.”
Push Back on Inflation
We’ll find out March’s jobs tally later this week, but another data point on Wall Street’s watch list is the core Personal Consumer Expenditures (PCE) price index.
- SEE MORE 5 Superb Stocks to Shield Against Stagflation
That report, due out Wednesday, represents the Federal Reserve’s favored gauge of inflation â another critical factor in the market’s direction from here.Â
“We believe it is important to point out the historical impact that inflation can have on equity market valuation,” says John Lynch, chief investment officer for Comerica Wealth Management. “Specifically, high levels of inflation ⦠have historically pressured the price-to-earnings (P/E) ratio for the S&P 500 Index. Historically, when the CPI approaches 8.0%, the average [trailing 12-month] P/E for the S&P 500 is ~12, which could bring the index to unspeakable levels.”
Given that the S&P 500 currently trades at more than 26 times trailing earnings, that would be very bad news, indeed.Â
You can swat back at inflation via just about any investment type you like. Those looking to make concentrated bets against rising prices can consider these five stocks poised to push higher in an inflationary environment, while those who prefer a diversified approach might instead prefer these five mutual funds.
But some of the most interesting tools in the tool box are inflation-fighting exchange-traded funds (ETFs). Several of these ETFs simply happen to be positioned in areas of the market that do well as prices expand, but in some cases, an inflation-resistant portfolio is the explicit goal.
- SEE MORE Warren Buffett Stocks Ranked: The Berkshire Hathaway Portfolio
Is the âNo Taperâ Good or Bad for Mortgage Rates and the Housing Market?
Yesterday, many declared âvictoryâ when the Fed decided not to taper its monthly purchases of mortgage-backed securities and longer-term Treasuries. Put simply, most assumed the Fed would announce some level of tapering, such as reducing their $40 billion in monthly MBS purchases by $10 billion, just to test the waters. Instead, they decided to keep [&hellip
The post Is the âNo Taperâ Good or Bad for Mortgage Rates and the Housing Market? first appeared on The Truth About Mortgage.
Two Reasons Not to Refinance Your Mortgage Right Now
Yes, all the news headlines are screaming, âRefinance NOW!â The term âmortgage ratesâ is trending hard. And all my friends are texting me asking if they should refinance their mortgages. Ugh. This is getting silly. Sure, mortgage rates are now at new all-time highs, but hang on a second. Letâs catch our collective breath and [&hellip
The post Two Reasons Not to Refinance Your Mortgage Right Now first appeared on The Truth About Mortgage.
Brexit vs. Mortgage Rates: How Low Might They Actually Go?
Bye Bye Britain Well, the unthinkable happened early this morning (or late last evening depending on where you live). The UK voted to leave the European Union, agreeing to Brexit instead of Bremain, as they say. So hold onto your cup of tea, itâs gonna be a bumpy ride. The initial reaction was one of [&hellip
The post Brexit vs. Mortgage Rates: How Low Might They Actually Go? first appeared on The Truth About Mortgage.
How Low Will Mortgage Rates Go?
It seems that lately we reach a new all-time low for mortgage rates just about every week, which begs the question, how low can they go? Indeed, mortgage rates have hit record lows eight times so far in 2020, and it is only mid-August. If you had to bet, youâd probably guess that weâd see [&hellip
The post How Low Will Mortgage Rates Go? first appeared on The Truth About Mortgage.
Existing home sales are still too hot
Mortgage rates are still meager, historically speaking, but 3.375% or higher may be enough to slow the home price growth rate â which, right now, is simply too hot. The days on the market went from 43 days last year to 21 days currently.
The post Existing home sales are still too hot appeared first on HousingWire.