Market Update
admin
SHARE
1.The consumer price index released on Wednesday rose 8.5% from the same period last year, lower than market expectations.Investors speculated that the price rise was under control, and the Fed may pivot. The speculation encouraging the stock market to rise. In particular, the tech-heavy Nasdaq index rose more than 20% from its June low, ending a five-month bear market. The market has also adjusted the probability of a 0.75% fed rate hike in September from nearly 80% to about 50%.
- Inflation being controlled is a reasonable expectation: While it is not guaranteed that the consumer price index will not reach new highs in the short term, it is reasonable to expect that prices will be controlled. Especially, with rents exluded , the CPI fell 0.3% from the previous month, and this has not happened since May 2020. A recession could further accelerate the fall in prices.
- No proof thatFed will make dramatic shift in policy: Two dovish officials of the Fed said that the Fed interest rate will not be affected in any way until consumer prices are fully controlled, and the statement coincides with our long-term forecast of the Fed. The stock market rose rapidly on Thursday when it opened, so it seems that the market clearly ignorethe Fed’s warning.
- Stokcs is overbought in the short term, with a high probability of a rebound poised or even reversed: Stocks continue to rally after mid-June lows. Especially, the jobs report and consumer price index both beat expectations so that investors’ fears of a recession, inflation, and the Fed rate hikes seem to be less of a problem. But in reality, the risk of a recession and a continued interest rate hike by the Feb have not diminished. We believe that the current rally is a common phenomenon in bear markets, and now the stock is overbought. The upward trend may be slow or reverse. Caution is a priority for new capital investment in the market
2.The average annual return of state and city pension funds in the United States, from July 1st 2021 to June 30th 2022, suffers the worst single-year since 2009, and it is also the first time since 2009 that the single-year return is negative.
- The average return of states and cities pension funds was 27% in the previous year, but the gains wasimmediately reversed this year. Many investors have no idea of their expected long-term returns or of the long-term market returns, . And they end up being disappointed as a particularly good short-term performance is often interpreted as sustainable in long-term.
All images are copyright to their respective owners and are protected under international copyright laws and are protected under international copyright laws.
Disclosure TransGlobal Advisory, LLC is a Registered Investment Adviser. This platform is solely for informational purposes. Advisory services are only offered to clients or prospective clients where TransGlobal Advisory, LLC and its representatives are properly licensed or exempt from licensure. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by TransGlobal Advisory, LLC unless a client service agreement is in place. “Likes” are not intended to be endorsements of our firm, our advisors or our services. Please be aware that while we monitor comments and “likes” left on this page, we do not endorse or necessarily share the same opinions expressed by site users. While we appreciate your comments and feedback please be aware that any form of testimony from current or past clients about their experience with our firm is strictly forbidden under current securities laws. Please honor our request to limit your posts to industry-related educational information and comments. Third-party rankings and recognitions are no guarantee of future investment success and do not ensure that a client or prospective client will experience a higher level of performance or results. These ratings should not be construed as an endorsement of the advisor by any client nor are they representative of any one client’s evaluation. TransGlobal Advisory, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance. TransGlobal Advisory, LLC may discuss and display, charts, graphs, formulas which are not intended to be used by themselves to determine which securities to buy or sell, or when to buy or sell them. Such charts and graphs offer limited information and should not be used on their own to make investment decisions.
