Macro Outlook
A Closer Look at the Macro Factors Influencing the Investing Environment
Macro Update | September 17 2020
Mixed Macro Messages Provide Unclear Path for Stocks
Federal Reserve policy remains a bullish backstop for stocks while the economy is struggling to sustain momentum of the initial recovery.
Market & Sector Trends | September 11 2020
Breadth Strength Tested As Indexes Struggle
Large-cap groups are seeing strength, while recent relative improvements in mid-cap and small-cap groups are being challenged.
Market & Sector Trends | September 8 2020
Volatility Not Yet Disrupting Breadth Gains
At the industry group level, Hotels, Restaurants & Leisure and Retailing have seen broad strength, while Energy and Utilities have been weak.
Fixed Income Monitor | August 31 2020
Treasury Yields Bear-Steepened
Powell comments on desire for more inflation not immediately recognizable in yields. Broadly munis tracked Treasuries and corporate spreads were tighter.
Monthly Chartbook | August 2020
Market & Sector Trends | August 31 2020
Sector New High List Expanding
More than half of the sectors in the S&P 500 made new 52-week highs last week.
Market & Sector Trends | August 24 2020
Breadth Trends Remain Robust
Sector-level momentum is faltering but price and breadth trends remain positive. Overall sector-level trends have deteriorated but remain in positive territory.
Macro Update | August 20 2020
Seeing Strengths and Strains in Housing Market
A decline in mortgage rates and changing living preferences in the midst of coronavirus is fueling some strength in the housing market.
Fixed Income Monitor | August 17 2020
Treasury Yields Uncharacteristically Bear-Steepened
Last week was different for Treasuries. Relatively solid (to expectations) economic data, in particular inflation data and retail sales, and big long-dated auctions moved the curve higher and steeper.
Market Commentary | August 13 2020
Shifting Winds Suggest Volatility Poised to Pickup
Weight of the evidence has shifted from bullish to neutral. Excessive optimism emerging even with calendar arguing for more caution. Breadth now bullish as rally participation has continued to expand.
Market & Sector Trends | August 10 2020
Trends Show Rally Participation Expanding
Improving trends among the mid-cap and small-cap groups have fueled recent strength. A sign of expanding rally participation.
Fixed Income Monitor | August 10 2020
Treasury Yields Rose a Few BPS by the End of the Week
Based on the labor report. Corporate credit tightened and muni ratios tightened in some more – all despite Congressional failure to close a relief package.
Fixed Income Monitor | August 3 2020
Treasuries Rallied Once Again to Achieve New Lows
10yr real yields now at -101 basis points. Economic data highlighted the weakness as Q2 GDP was -9.5% and jobless claims improvement stalled. Corporate credit mixed and munis strong.
Monthly Market Chartbook | July 2020
Market & Sector Trends | August 3 2020
Discretionary & Technology Continue to Lead
Overall sector-level trend indicator is off its recent peak, but downside risks likely remain limited as long it is still in positive territory.
Macro Update | July 30 2020
Despite Attention, Valuations Less of a Concern – For Now
Stocks appear fairly valued versus corporate bond yields.
Market & Sector Trends | July 27 2020
Sector Trends Point to Leadership Rotation
Technology, Discretionary & Telecom suggest momentum (and leadership) in those areas may be slipping.
Fixed Income Monitor | July 27 2020
Treasuries Rallied in Flattening Fashion
Backpedaling on jobless claims progress. Corporate spreads continued to tighten meaningfully.
Muni Fortnightly | July 20 2020
Looking For Signs of a Fiscal Deal
Markets are looking for signs from Congress to alleviate economic pain from the recession.
Market & Sector Trends | July 20 2020
Cyclical Sectors See Relative Strength Improve
Momentum is getting back in gear while price and breadth trends remain strong.
Fixed Income Monitor | July 20 2020
Treasuries Little Changed on a Broad Array of Sequentially Better Economic Data
Corporate credit spreads tighten and muni yields fall.
Market & Sector Trends | July 13 2020
Industry Group Trends Still In Consolidation Mode
Price and breadth trends at the sector level remain strong, and momentum trends are improving.
Investment Strategy Outlook | July 10 2020
Second Half to Provide Test of Market Strength
Fed pushing for fiscal stimulus.
Market & Sector Trends | July 6 2020
Trends Proving Resilient Despite Uncertainty
Sector-level trends show strength from a price and breadth perspective even though momentum is weak.
Market & Sector Trends | June 30 2020
Trends Point To Consolidation Not Correction
Sector-level trends (especially momentum) have deteriorated in recent weeks.
Fixed Income Monitor | June 30 2020
Equities and Credit Spreads Weaker while Treasuries Bull-Flattened
Treasuries bull-flattened as risky assets fell on virus resurgence concerns and stress test caution. Muni ratio and corporate credit spreads rose.
Muni Fortnightly | June 22 2020
Treasury yields were little changed in low volatility.
Bond markets were quiet end to end with some volatility thrown in intraweek. Risky asset markets took kindly to the Fed’s announcement that it would begin implementing its previously announced corporate bond buying program.
June 18 2020
After Economic Pileup, Traffic Starting To Lurch Forward
- After standstill, any improvement is encouraging
- Uneven recovery could struggle with sustainability
- Liquidity challenges pose risk to recovery
Fixed Income Monitor | June 15 2020
Two Very Different Weeks Within One
Treasuries rallied throughout the week, accelerating after gloomy FOMC meeting commentary and broad equity sell-off. Spread sectors widened significantly.
Market & Sector Trends | June 15 2020
Market Consolidation Provides Test of Resiliency
After surging to its highest level since September, the sector-level trend indicator has cooled off as the S&P 500 has consolidated its recent gains.
Fixed Income Monitor | June 8 2020
Treasuries Bear-Steepened as Risk-Aversion Melted Down
Equities and corporate credit spreads rallied while munis completed their relative-value round trip and the labor market reflected under predicted improvement.
Market & Sector Trends | June 8 2020
Improving Trends Signal Broad Rally Support
Sector-level trend indicator has continued to strengthen, breaking out of the pattern of lower highs that emerged earlier this year.
June 4 2020
Economic Imbalances Reveal Wall Street/Main Street Divide
- Stock market and economy on different trajectories
- Economic inequality adding to tensions
- Out of uncertainty comes opportunities for growth
Monthly Market Chartbook | May 2020
Market & Sector Trends | June 1 2020
After Delay, Small-Cap Leadership Emerges
Sector-level trends continue to improve, providing fuel for index-level strength. Momentum trends remain robust overall while price and breadth have been slower to improve.
Market & Sector Trends | May 26 2020
Market Rotation Suggests Economy In Transition
Weekly industry group trends are getting back in gear – 95% of the individual groups are trading above their 10-week averages and our overall indicator has jumped to 40%.
Economic Chart Pack | May 20 2020
Evidence Improving Though Recovery Likely to Be Uneven
“What gets us into trouble is not what we don’t know. It’s what we know for sure that just ain’t so.” -- Mark Twain
Market & Sector Trends | May 18 2020
Sector Trends Not Endorsing Index-level Strength
Sector trends not endorsing index-level strength.
Fixed Income Weekly Monitor | May 18 2020
Risky Assets Were Weighty and Treasuries Were Little Changed
Corporate credit spread performance mixed with high-yields widening. Munis rallied strongly with continued signs of stability.
Fixed Income Weekly Monitor | May 11 2020
Treasures are Mixed on a Steeper Curve
Corporate credit spread tightening stalls with strong issuance.
Muni Fortnightly | May 11 2020
What Happened in the Bond Markets Last Week?
Treasury yields mixed with curve steepening. Muni yields fall, relatively richening. Moody’s puts State and Local government sectors on negative credit outlook.
Market & Sector Trends | May 11 2020
Large-Caps Leading But Small-Caps Improving
Despite the rally off of the March lows, our sector-level trend indicator remains in negative territory.
Macro Update | May 5 2020
Taking Stock of the Economic Damage
Economic damage takes time to heal.
FIxed Income Weekly Monitor | May 4 2020
Relatively Immune
As equity markets experienced a Jekyll and Hyde personality other markets were relatively immune to the volatility. Treasuries were little changed. Credit spreads tightened.
Market & Sector Trends | May 4 2020
Sector & Industry Group Trends Suggest Caution
Sector trend indicator improved over the course of April, but has not yet gotten back into positive territory.
Macro Update | Apr 28 2020
Economic Damage Takes Time to Heal
Resetting expectations can reduce frustration and help fuel economy.
Market & Sector Trends | Apr 27 2020
Breadth Slow To Improve As Defensive Groups Lead
Short-term momentum trends remain positive, but improvement in price and breadth trends has been more uneven.
Muni Fortnightly | Apr 22 2020
Treasury and Municipal Yields Declined in a Move Toward Less Volatility
CARES Act impact helpful but insufficient. Municipal Liquidity Facility launched.
Weight of the Evidence | 4 21 2020
Stocks Off Lows, But Evidence Remains Neutral
Stocks have been looking past an economic pile-up and price gains have outpaced improvements in broad market trends
Market & Sector Trends | Apr 20 2020
Sector-Level Trends Struggle To Gain Traction
S&P 500 has rallied 30% off its March low, but sector-level trends are not endorsing this move.
Macro Update | Apr 14 2020
Stimulus Coming but Economic Pile-Up Hampers Rejuvenation Efforts
Strength of recovery will be tied to length of shutdown.
Market & Sector Trends | Apr 13 2020
Despite Bounce, Sector-Level Trends Still Weak
Rally off of March lows has come with improved momentum trends, but price and breadth trends remain weak.
Market & Sector Trends | Apr 6 2020
Industry Group Trends at Lowest Level In Decade
Across sectors, short-term price and breadth trends remain negative but momentum has turned positive.
Macro Update | Mar 31 2020
Investors Should Brace For Negative Headlines
History shows stocks bottom before economy turns higher.
Muni Fortnightly | Mar 30 2020
Continued Volatility in All Paper Asset Markets
Treasury and municipal yields were extremely volatile. Moody’s notes sector outlook changes and exposures to economic fallout.
Market & Sector Trends | Mar 30 2020
Watch Sector Trends for Strength of Rally
Seeing sector-level trends in positive territory would suggest a sustainable rally (not just a bounce) has emerged.
Investment Strategy Outlook | Mar 25 2020
Evidence Argues For Patience In Face Of Coronavirus Weakness
The cyclical decline may be entering a period of enticing rallies and frustrating re-tests that can challenge investor patience.
Market & Sector Trends | Mar 23 2020
Amid Broad Selling, Defensive Groups Gain Relative Strength
Short-term sector level trends remain buried as selling pressure has been intense.
Market & Sector Trends | Mar 16 2020
Breadth Collapses as Selling Intensifies
Short-term sector level trends are universally negative coming into this week. A rally that has legs will have to reverse these trends.
Stock Market Update | Mar 11 2020
Bear Market Realities
Evidence of panic today points to possible peak in near-term volatility. With the weight of the evidence still neutral, patience on the part of investors is the recommended strategy.
Weight of the Evidence | Mar 10 2020
Breadth Turns Bearish But Sentiment Improves
Downside momentum is intact. Longer-term breadth trends continue to deteriorate and multiple indexes have undercut December 2018's lows. Short-term sentiment indicators are getting washed out, but deep-seated complacency is only beginning to unwind. Patience remains the best near-term approach.
Muni Fortnightly | Mar 9 2020
Treasury Yields Fall to Lowest Level Ever – All Below 1%
Fed Funds cut 50 bps. Munis can’t keep up – ratios ratchet higher. Credit spreads at widest levels since 2016 in corporate high-yields.
Market & Sector Trends | Mar 9 2020
Defensive Groups Ascendant
Energy sector trends remain poor and show little evidence of stabilizing.
Macro Update | Mar 4 2020
Tracking the Spread of Economic Effects of the Coronavirus
While the ultimate impact of the virus remains to be seen, moving from a stance of reaction to anticipation would be a helpful development, especially for the financial markets.
Weight of the Evidence | Mar 2 2020
Broad Market Deterioration Drops Evidence To Neutral
Recent stock market volatility is weighing on broad market trends, which failed to confirm new index-level highs in February. Absent a decisive break in the downside momentum that emerged last week, a more cautious view is warranted.
Stock Market Update | Feb 28 2020
Breaking News
Follow-up Addressing the Recent Volatility and the Coronavirus
Stock Market Update | Feb 25 2020
Breaking News
Addressing the Recent Volatility and the Coronavirus.
Stock Market Update | Feb 24 2020
Elevated Valuations and Excessive Optimism Have Investors Focused on Headlines
Headline-fueled volatility has the S&P 500 testing support at the January lows. A break of that level could lead to a deeper unwind of excessive valuations/optimism as the market digests the economic implications of the spread of the coronavirus.
Investment Strategy Outlook | Feb 21 2020
Evidence Bullish Despite Volatility and Uncertainty
Excessive optimism and widespread complacency turns sentiment bearish. Seasonal patterns bullish with economic confidence consistent with incumbent reelection. Declining bond yields fueling strength in Gold.
Market & Sector Trends | Feb 18 2020
Cyclical Sectors Struggle to Gain Traction
Our sector-level trends continue to improve as momentum expands and price remains strong. Breadth trends remain mixed.
Macro Update | Feb 11 2020
Is Economic Optimism Warranted?
Americans feeling confident. The rebound in business optimism suggests animal spirits are returning.
Market & Sector Trends | Feb 10 2020
Price Strength Outpacing Breadth Gains
Industry group trends barely budge as S&P 500 moves to new highs.
Muni Fortnightly | Feb 3 2020
Treasury Yields Fell Sharply for Second Consecutive Week
Coronavirus impacts on risk tolerance and potential impacts on the real economy.
Market & Sector Trends | Jan 27 2020
Uncertainty Fueling Flight to Safety
Sector-level momentum trends are deteriorating, with cyclical sectors showing the most weakness. Our overall sector-level trend indicator remains in positive territory, as price and breadth trends remain relative robust.
Market & Sector Trends | Jan 21 2020
Utilities Rise, Financials Fade as Bond Yields Fall
Sector-level trends remain strong and supportive of continued rally attempts by the S&P 500.
2020 Market Update - Baird Wealth Strategies | January 2020
What Matters and What Doesn't
Recording: Michael Antonelli, Baird’s Private Wealth Management Market Strategist and author of the popular Bull & Baird blog, provides his views on the current state of the economy and stock market.
2020 Global Industrial Report
Finding Opportunity in Uncertainty
Baird's Head of Global Equities reflects on how the industrial sector is adapting to change and setting a course for the decade ahead.
Muni Fortnightly
Ratios Back to Near Most Expensive Levels
Treasury Yields Whipsaw on Iranian-Conflict and Weak Payroll Data.
2020 Wealth Management Outlook
What We’re Paying Attention to in 2020
Will the presidential election affect the stock market in 2020? Could global trade concerns derail economic growth? Should you be thinking differently about your financial plans because of The SECURE Act?
Technical Review | Jan 9 2020
Trends Argue for Continued Stock Market Strength
Weight of the evidence (below Jan. 6) remains tilted toward the bullish camp. Key takeaways on the market factors supporting that view.
Macro Update | Jan 7 2020
2020 Earnings Outlook: Optimism and New Leadership
Companies with international exposure fuel 2020 earnings expectations. After finishing 2019 with a whimper, earnings expected to rebound this year. Earnings growth likely to struggle in the face of fundamental headwinds.
Weight of the Evidence | Jan 6 2020
Bullish + 1
Not a low risk environment, but a bullish side tilt.
Market & Sector Trends | Jan 6 2020
Broad Strength
Trend indicator has risen from 15% to 84% over the past year.
2020 Outlook Supplemental Charts | Dec 12 2019
Cyclical Strength Emerges Amid Ongoing Uncertainty
2018 vs. 2019 reflects the shift from central banks tightening to central banks easing. This tailwind will carry into 2020.
Economic & Market Outlook 2020 | Dec 9 2019
Cyclical Strength Emerges Amid Ongoing Uncertainty
Recession risk in US remains low. Globally, green shoots offer encouraging evidence of improvement. Elevated valuations and a fully invested public could leave stocks vulnerable to volatility if uncertainty remains elevated. After a decade of US large-cap strength, opportunities for new leadership are on the rise.
Macro Update | Nov 19 2019
Stocks Buoyed by Better-Than-Expected Q3 Earnings
Many companies surpassed Q3 expectations, though not by much. Expectations for 2020 moving lower but still suggest growth re-acceleration. Elevated valuations remain a headwind for stocks.
Oct 2019
Learning to Eat Ground Glass
The Federal Reserve actions and interest rates have not gone as predicted by many economists and analysts. We examine what went wrong and where we go from here.
Sept 27 2019
Forward Earnings within a Fair Value Range
Our Macro Framework for US Markets and Why We Like Healthcare, Financials & Energy.