Podcast
ANGLES.
Hosted by Simon Brady CFP® · EN
Every Sunday, Anglia Advisors founder Simon Brady CFP® CETF® recaps the week in financial markets.
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2w ago00:05:27Tap to summarizeTrump and Rubio spent last Saturday teasing that a US/Iran agreement including a re-opening of the Strait of Hormuz was “95% done” and was hours away from being finally announced. Iran quickly denied that anything was imminent and indeed there was nothing substantial to report by the time Asian and European markets opened on Monday, which was a holiday in the US and a number of other countries. Nevertheless, oil prices tumbled and overseas stocks moved higher on the prospect of an end to the conflict. There was still nothing to report by the time US traders returned to their posts on Tuesday morning. Indeed, Trump had actually ordered renewed air strikes overnight and Israel resumed its assault on civilian targets in both Gaza and Lebanon, all of which stalled gains in Asian and European stock markets. US stocks initially surged with Big Tech and small caps once again leading the charge and interest rates dived as Wall Street got its first chance to react to the possible progress, taking its cues from still-falling energy prices. Enthusiasm waned as the session wore on, however, with more non-stop war blather but precious little evidence of any deal. The indexes still managed to finish in the green, though. There were yet more claims and counter-claims of an accord as well as a fountain of confusing rhetoric on Wednesday (including a head-scratching threat from Trump to “blow up” US ally Oman), but jaded traders were tuning it out, viewing the US administration as a bit like the teacher in a Charlie Brown cartoon and finally appear to be stubbornly refusing to engage with all the nonsense in the absence of anything tangible or even vaguely accurate to digest. Stocks inched just a little higher but by enough (you guessed it) to set new all-time records for the major indexes. The US launched more air strikes overnight into Thursday sending energy prices spinning higher again. Premarket data drops included the latest GDP estimate showing a slightly disappointing 1.6% growth rate and PCE annualized inflation holding steady as expected at 3.8%. Solid earnings from Best Buy and Dollar Tree indicated that, while Americans are extremely pissed off right now according to record low consumer sentiment data, they just can’t stop spending money. Mostly due to simply following the path of least resistance, stocks drifted higher without too much conviction to complete a sixth straight day of gains and move deeper into record high territory. The party continued into the last trading day of the month on Friday, fueled in part by Dell whose stock price exploded higher by 33% at the open after blowout earnings and outlook. Despite some late profit-taking, the winning streak for the major indexes remained intact to get to seven straight days with three sessions in a row each resulting in new all-time record highs. The S&P 500 closed up 6.2% for the month of May and scored its ninth straight week of gains while the NASDAQ completed its best-performing two-month spell since the original Tobey Maguire Spiderman movie was in cinemas back in 2002. Some other things I’m thinking about ..* The Strait of Hormuz has been closed for three months now. Over that time the S&P 500 is up ~10% and the NASDAQ by ~20%. Stocks are being driven by a tug-of-war between geopolitics, oil prices, interest rates and a powerful earnings and AI narrative, but all with a highly asymmetric “glass is half full” bias, leading to a current market environment where good news is great news, no news is good news and even bad news is kind of okay. * The face-ripping run of Micron, with the stock price up over 850% in the last year and doubling in value in just 48 days to above a trillion dollar valuation, is helping to pull the tech sector back to a position of dominance. Of the eleven sectors in the S&P 500, Technology is the only one outperforming the index since the recovery from the lows of early April. This lack of breadth to the most recent rally can be looked at in two ways: * With concern - as the gains are highly concentrated and a nasty turn in the sector or even in just a few names would badly impact the indexes * With relish - at the prospect of the rest of the sectors catching up with the index’s spectacular tech leadership. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..Homeowners’ insurance premiums and deductibles are soaring all over the country. The insurance companies tell us that their policies provide financial peace of mind, but almost half the time they will refuse to pay out on your claim. .. AND I QUOTE ..“Stocks are priced for perfection in an imperfect world.”Emily Roland, JH Investment Management co-chief investment strategistLAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.com* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 0.7% last week, is higher by 10.6% over the last three months and is up 11.2% so far this year. * IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 0.6% last week, is higher by 11.3% over the last three months and is up 18.2% so far this year.* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 0.5% last week, is higher by 2.8% over the last three months and is up 14.2% so far this year. Data shown is total return (including dividends)INTEREST RATES:* FED FUNDS RATE * 3.625% (unchanged from a week ago)* PRIME RATE ** 6.75% (unchanged from a week ago)* 3 MONTH TREASURY 3.69% (3.68% a week ago)* 2 YEAR TREASURY 3.98% (4.13% a week ago)* 5 YEAR TREASURY 4.13% (4.27% a week ago)* 10 YEAR TREASURY *** 4.45% (4.56% a week ago)* 20 YEAR TREASURY 4.98% (5.06% a week ago)* 30 YEAR TREASURY 4.99% (5.07% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan interest rates such as credit cards, auto loans, personal loans, home equity loans/lines of credit and securities-based lending. *** Used as a basis for determining mortgage interest rates.AVERAGE 30-YEAR FIXED MORTGAGE RATE:* 6.53%One week ago: 6.51%, one month ago: 6.29%, one year ago: 6.89%Data courtesy of the Federal Reserve Bank of St. Louis.INTEREST RATE EXPECTATIONS:Where will the Fed Funds interest rate be after the next rate-setting meeting on June 17th?* <strong...
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TACO or NACHO?
3w ago00:05:54Tap to summarizeAnother weekend, another complete lack of progress or even any useful information related to the Iran war as the paralysis continued with both sides wasting everybody’s time and effort by offering up proposals that are clearly non-starters since they know full well the other side won’t accept them. Wall Street loves itself a corny acronym and while bulls are tending to still hold on to the long-standing principle of TACO, many of the bears are adopting NACHO (Not A Chance Hormuz Opens). All we really got was Trump barking that “the clock is ticking”. No s**t, thought Wall Street traders who had been promised an end to all this uncertainty weeks ago. With inflation fire alarms starting to go off all over the world, markets made a cautious start to the week on Monday. After Japanese interest rates were driven to the highest levels in history overnight, stock prices dipped in New York, led lower by recently-buoyant Big Tech names, with energy prices and US interest rates continuing to head north on slowly evaporating confidence in an imminent workable US/Iran pact. Oil prices eased slightly late on as Trump implausibly announced that he had been talked out of resuming military strikes on Iran by Gulf allies pending some kind of unspecified deal, but Wall Street shrugged this off on Tuesday as just another tiresome and transparent negotiating ploy. The first of the week’s impactful earnings reports came out with Home Depot disappointing. The indexes retreated further, again tech-fueled, with stock traders nervously eyeing the one-way traffic in bond markets that was sending longer term interest rates to highs not seen since Soulja Boy topped the Billboard charts. Wall Street got another read on the American consumer with Target, TJ Maxx and Lowe’s earnings on Wednesday morning all beating estimates. There was nothing in the released minutes from the latest Fed meeting that indicated an imminent Fed Funds Rate cut, but they don’t seem to be overtly plotting a hike either, although the most commonly-expected next Fed move in 2026 has now flipped over from doing nothing to actually raising rates (see INTEREST RATE EXPECTATIONS below). Stocks chose to take encouragement from the continued positive earnings environment and the indexes moved nicely higher, erasing the losses of the previous two days as oil prices drifted lower. Bonds had a much better session as interest rates pulled back from their recent highs. Nvidia’s earnings after the bell were perfectly good but lacked a wow factor and the stock did little in the after-market. On Thursday, Walmart’s pre-market earnings, considered a good barometer of the state of lower-and-middle income consumers and the K-shaped economy, showed significant profit margin compression and the stock sank. Combined with a muted reaction to Nvidia’s numbers and the continued endless foot-dragging and more unruly rhetoric from both sides of the Iran war spiking energy prices again, this sent the indexes slipping back into the red early on, but a late bout of dip-buying dragged them back up to close lightly in the green. Stocks completed their eighth consecutive week of gains on Friday, the longest such streak for three years, as longer term interest rates and energy prices continued to recede on the hopes of some kind of a US/Iran settlement ticked a little higher based on still-hazy but slightly more upbeat pronouncements from both sides. Some other things I’m thinking about ..* For AI-driven stock market growth to be sustainable the biggest tech companies will need to see a positive return on their colossal data center spending. If this fails to materialize because people and companies don’t use AI as much as expected or pay for its use, then the so-called hyper-scalers (Meta, Amazon, Oracle, Microsoft, Google etc.) will have to cut spending on them and that could badly damage the rest of the tech sector and thereby the tech-heavy US indexes. We won’t find out that out in the near term, but stock markets are currently acting like the answer can only be “yes, the spending will continue come what may,” and I’m not yet 100% convinced that’s definitely true beyond the next few quarters.* Trump’s job approval rating is cratering, consumer sentiment is at a horrendous multi-decade record low (even Republican voters are fuming) and inflation expectations are through the roof, just a few months before the midterms as Americans go into the Memorial Day long weekend with average gas prices above $4.50 a gallon, having spent an extra $20 billion at the pump in the last twelve weeks as a direct result of the Iran war. It is all this as much as anything else that might bring the conflict to some kind of a resolution relatively soon. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..“Evidence of a ferocious backlash against AI, especially among young people, is everywhere”. College grads just aren’t having it... AND I QUOTE ..“It’s not cost cutting; it’s replacing in some cases lower-value human capital with the financial capital and the investment capital we’re putting in.”Bill Winters, CEO of Standard Chartered Bank, was widely slammed for this clumsy quote last week, describing the bank’s employees as “lower-value human capital”. LAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.com* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 1.0% last week, is higher by 4.2% over the last three months and is up 5.7% so far this year. * IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 2.9% last week, is higher by 7.4% over the last three months and is up 13.2% so far this year.* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 1.4% last week, is higher by 4.1% over the last three months and is up 10.1% so far this year. INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬇︎ 3.68% (3.69% a week ago)* 2 YEAR TREASURY ⬆︎ 4.13% (4.09% a week ago)* 5 YEAR TREASURY ⬆︎ 4.27% (4.26% a week ago)* 10 YEAR TREASURY *** ⬇︎ 4.56% (4.59% a week ago)* 20 YEAR TREASURY ⬇︎ 5.06% (5.14% a week ago)* 30 YEAR TREASURY ⬇︎ 5.07% (5.12% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan interest rates such as credit cards, auto loans, personal loans, home equity loans/lines of credit and securities-based lending. *** Used as a basis for determining mortgage interest rates.AVERAGE 30-YEAR FIXED MORTGAGE RATE:* ⬆︎ 6.51%One week ago: 6.36%, one month ago: 6.24%, one year ago: 6.86%Data courtesy of the Federal Reserve Bank of St. Louis.INTEREST RATE EXPECTATIONS:<...
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Meaningless Drivel.
4w ago00:06:59Tap to summarizeTrump decided over the weekend that he“didn’t like” Iran’s response to the US proposal to end the conflict but yet again there was little of substance regarding the war for Wall Street to focus on, with markets continuing to view the situation as slowly trending towards some kind of ceasefire. The Strait of Hormuz has been closed for ten weeks now with no prospect of reopening, a once-unthinkable shock to the world economy and yet the oil price came into the week still well below the high of $140 seen in 2022 (Russia/Ukraine) and global stocks at all-time highs. US stocks hovered around those highs at the open on Monday with Trump describing the current pause in Middle East hostilities as being “on life support” and continued rising energy prices keeping a lid on the recent melt-up, but the indexes still managed to inch forward a touch. Hence, more new all-time record levels. The latest CPI report on Tuesday morning was the first to fully include higher fuel costs brought about by the war and inevitably showed another big leap in retail inflation to 3.8% annualized, closing in on double the Fed’s 2% target (which it hasn’t met for five years now). Gas prices are up by 28% from a year ago and airfares by 21%. Notably, retail prices are now rising at a faster rate than wages. Interest rates shifted upwards on the vanishing prospect of any rate cuts at all in 2026 or early 2027. Indeed, an increase in the Fed Funds Rate this year is now priced as being more likely than a rate cut. Wall Street winced at the data and the indexes pulled back and interest rates jumped. Trump arrived in Beijing on Wednesday morning for a meeting with Chinese premier Xi after bizarrely telling journalists; “I don’t think about Americans’ financial situations”. Kevin Warsh was waived through Congress as the next Fed chairman and was immediately confronted with a big problem. CPI’s baby brother, PPI, was released pre-market and came in red hot, indicating a jaw-dropping jump from 4.3% to 6.0% in the annualized wholesale rate of inflation. The bond market was shocked and drove up medium and longer term interest rates. The 30-year Treasury rate blasted through 5.00% to its highest level since 2007, before the Great Financial Crisis. Stocks, however, took things in stride and tech stock traders in particular stepped in to buy Tuesday’s dip, pushing the indexes into the green and back to yet more record highs. By the time markets opened on Thursday, all that had come out of China was meaningless drivel about partnership and obscure references to Confucius and Abraham Lincoln. Of far more interest was the latest Retail Sales data which showed continued steady, if not profligate, spending by the US consumer. Despite the continued lack of anything interesting emanating from Beijing, stocks continued to move relentlessly higher, helped by a spectacular earnings report from Cisco. The major indexes reached their third set of all-time record highs of the week with the S&P 500 closing above 7500 for the first time ever and even the silly old dinosaur index that is inexplicably still followed by some people, the Dow Jones Industrial Average, broke through 50,000. The complete nothing-burger that was the Trump/Xi summit came to an end on Friday with muddled messaging from the US delegation and no apparent progress on Iran or tariffs. After a horror-show of a trading session in Europe with stocks and bonds plunging as local interest rates reached multi-decade highs and continued rising energy prices, US equity indexes cooled off as stock traders finally joined bond traders in fretting about inflation risk and took a lot of money off the table. Some other things I’m thinking about ..* I think it’s important to identify and recognize what could go wrong here for stock markets. To be clear, these are possible scenarios, not predictions .. * Fed hikes interest rates: For the first time in years, the market-driven probability of a Fed Fund Rate increase by year-end is now higher than that of a cut as inflation continues to be a major and growing problem, fueled by tariffs and the oil price shock. A forced rate-hiking campaign could cause a major economic slowdown. The last time the Fed had to raise rates to control inflation in 2022, stocks dumped by more than 20%.* Stagflation materializes: It is the expected duration rather than the intensity of high inflation that matters. The longer energy prices stay high, the more entrenched elevated inflation will become, fueling possible stagflation and unlike in COVID-times, there will be no stimulus checks this time to help offset it. * The AI boom goes bust: Earnings reports have indicated colossal AI spending from a narrow group of tech companies that is potentially driving wider economic and corporate growth. If that expenditure were to be forcibly slowed due to poor investment returns, then the platform upon which a three-and-a-half year rally has been built could begin to crumble and many other sectors might be adversely impacted. * None of these three risks are imminent and the market is fundamentally strong. But stocks can go down, sometimes sustainably and I don’t want clients to be blindsided if it happens. Absent some kind of exogenous shock, any major decline is likely to be the result of one or more of these factors. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..“Your ability to take risk throughout your financial life will be influenced by three primary factors—your age, your liabilities and your level of wealth. As each increases, you should naturally want to take less risk.”Maybe counterintuitive? Yes. Very sensible? Also yes. Important advice from Ritholtz’s Nick Maggiulli... AND I QUOTE ..“Risk management is less about how you respond to risk and more about recognizing how many things can go wrong before they actually do.”Morgan Housel, partner at The Collaborative Fund. LAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.com* SPYM, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 0.2% last week, is up 8.4% so far this year and ended the week 1.4% below its all-time record closing high (05/14/2026). * IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price fell 2.3% last week, is up 12.8% so far this year and ended the week 3.5% below its all-time record closing high (05/06/2026).* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price fell 2.7% last week, is up 10.2% so far this year and ended the week 3.1% below its all-time record closing high (05/06/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬌ 3.69% (3.69% a week ago)* 2 YEAR TREASURY ⬆︎ 4.09% (3.90% a week ago)* 5 YEAR TREASURY ⬆︎ 4.26% (4.02% a week ago)* 10 YEAR TREASURY *** ⬆︎ 4.59% (4.38% a week ago)* 20 YEAR TREASURY ⬆︎ 5.14% (4.93% a week ago)* 30 YEAR TREASURY ⬆︎ 5.12% (4.95% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x...
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Vertical.
May 1000:05:48Tap to summarizeIt was yet another weekend of nothing of substance war-wise for markets to chew on, apart from both sides ramping up the rhetoric and Trump posting some kind of characteristically detail-free vague promise called “Project Freedom” to somehow help guide tankers through the Strait of Hormuz. Markets were unimpressed. Oil prices and interest rates spiked higher on Monday and stocks fell back from their record highs following exchanges of fire for the first time in weeks as we all got an unwelcome reminder that this war was not over. Cracks in the fragile ceasefire continued to appear on Tuesday but neither side seems to yet to have reached the pain level required to be willing to announce its demise. For the US, that pain level probably stands at around $160 oil, a 4.75% 10 year Treasury rate and even deeper midterm woes for Republicans. A buoyant risk-on stock market quickly recovered all of Monday’s losses, bolstered by Intel’s announcement of a deal with Apple. The indexes reached another new set of all-time highs. After the close, Advanced Micro Devices (AMD) released sensational earnings, Trump shut down Project Freedom after less than two days and the average price per gallon at US pumps reached $4.56, its highest level since the summer of 2022. Reports on Wednesday morning that the US and Iran were closing in on a one-page, 14-point Memorandum of Understanding and Secretary of State Rubio straight up telling Congress that the war was over sent oil prices and interest rates tumbling. Stocks went vertical with Wall Street traders keen to consign the conflict to the history books and finally get back to their happy place where they could focus on corporate earnings, interest rate projections and economic data rather than constantly having to try and interpret grammatically-challenged social media posts. The soaring rally spilled into Asia on Thursday with Japanese stocks in particular ripping higher, but wavered when markets opened in New York. Perhaps with one eye on the following day’s crucial employment numbers and in response to oil prices and interest rates slowing their declines from the previous day, Wall Street took its foot off the gas and the indexes closed in the red. After the close, the US Court of International Trade ruled Trump’s imposition of 10% across-the-board Section 122 tariffs to be illegal, just weeks after the Supreme Court tossed out his IEEPA tariffs. Further exchange of fire between the US and Iran overnight was dismissed by Trump as a “love tap” . But it did cast some doubt on the prospects of a deal and sent oil prices briefly higher again on Friday ahead of the pre-market Jobs Report which showed a significantly greater-than-expected number of new payrolls and an unchanged unemployment rate of 4.3%. This Goldilocks data confirmed a stable labor market and pushed back against fears of stagflation. Interest rates shifted lower and the stock indexes, boosted by another big day for Intel and several other semiconductor names, jumped again to wipe out Thursday’s losses and complete a sixth straight week of gains. The S&P 500 index notched its 15th new record high of the year (after almost 40 of them in 2025) and the NASDAQ scored its 11th. Some other things I’m thinking about ..* Market valuations are clearly stretched in the short term and there are still risks to monitor. But there are genuinely legitimate reasons for the new highs. So, while this market remains vulnerable to temporary downside air pockets on any US/ Iran disappointment, there are fundamentally solid financial positives to be found in the best earnings in over twenty years and a resilient US consumer that are supporting stock prices. While these factors remain in place, the risk of a major fall in the indexes is probably limited. But if they deteriorate, the drop from these levels has the capability to be dramatic. * Prediction betting markets at Polymarket, PredictIt and Kalshi are being pitched on social media as a lucrative side hustle for young Americans squeezed by rent and student debt. However, the reality is that almost all of them are losing money, with over 100,000 accounts on Polymarket down by at least $1,000. Trade records show that the bulk of profits were raked in by a tiny group of what appear to be automated bots while everyone else on the platform, in aggregate, lost $131 million. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..Various AI platforms were asked to create and manage a stock portfolio. It didn’t go well... AND I QUOTE ..“They’re literally running out of money at the end of the month.”Steve Cahillane, CEO of Kraft Heinz, referring to low-income US consumers facing tariffs, rising gas prices and stubborn inflationLAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.com* SPYM, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 2.4% last week, is up 8.2% so far this year and ended the week at its all-time record closing high (05/08/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 1.8% last week, is up 15.4% so far this year and ended the week 1.2% below its all-time record closing high (05/06/2026).* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 3.0% last week, is up 13.2% so far this year and ended the week 0.4% below its all-time record closing high (05/06/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬆︎ 3.69% (3.68% a week ago)* 2 YEAR TREASURY ⬆︎ 3.90% (3.88% a week ago)* 5 YEAR TREASURY ⬌ 4.02% (4.02% a week ago)* 10 YEAR TREASURY *** ⬇︎ 4.38% (4.39% a week ago)* 20 YEAR TREASURY ⬇︎ 4.93% (4.96% a week ago)* 30 YEAR TREASURY ⬇︎ 4.95% (4.97% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan interest rates such as credit cards, auto loans, personal loans, home equity loans/lines of credit and securities-based lending. *** Used as a basis for determining mortgage interest rates.AVERAGE 30-YEAR FIXED MORTGAGE RATE:* ⬆︎ 6.37%One week ago: 6.30%, one month ago: 6.39%, one yea...
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Shooting Back.
May 300:06:58Tap to summarizeA potentially blockbuster week laced with pivotal earnings reports from almost $30 trillion-worth of S&P 500 names including five of the Magnificent Seven, key economic data and central bank interest rate decisions at home and abroad began following a weekend of no discernible progress on the Iran War. With limited credible conflict newsflow, Wall Street eased gently into the first half of the week on Monday, conserving its energy perhaps for a possibly more volatile second half. After solid sessions in Asia and Europe, US stocks essentially flatlined for the session but squeaked out just enough to notch more new all-time record highs for the S&P 500 and NASDAQ indexes. The Bank of Japan left local interest rates unchanged on Tuesday. Energy prices continued to climb with Strait of Hormuz traffic remaining at a standstill and the United Arab Emirates’ shock withdrawal from Saudi-dominated OPEC, raising the average price of a gallon of gas at US pumps to $4.30 and over $6.00 in California. Trump posting a picture of himself with a machine gun and the caption: “NO MORE MR. NICE GUY!” didn’t help. US stocks faltered, pulling back from their record levels with the NASDAQ reversing hardest on a Wall Street Journal report of trouble at OpenAI which sent tremors through some of the firm’s many tech partners and acted as a sharp reminder to investors to maintain portfolios that are balanced across sectors. Big Wednesday arrived with a Fed Funds Rate-setting announcement on tap followed by Jerome Powell’s final press conference as chairman and a tsunami of monster earnings after the closing bell. The Fed obviously did nothing with interest rates but a split is clearly emerging on the committee between those looking to maintain a bias towards only focusing on cutting rates in the near future and other members looking for more symmetrical and flexible language that at least leaves the door open for possible interest rate hikes in response to the increasing inflation pressure brought about by tariffs and war. In a lively press conference, Powell confirmed that he would stay on as a Fed governor once his chairmanship expires later this month, infuriating Trump. The indexes ended the session a little lower. Broadly speaking, the earnings reports were graded by Wall Street as follows: * Alphabet/Google: Excellent job all round. A gold star for the teacher’s pet.* Microsoft: Could do better on AI service offerings. We aren’t angry, just a bit disappointed.* Meta: Overspending yet again on unproven, kinda strange stuff. You have to rein it in and we likely won’t be happy until you do.* Amazon: Revenues growing nicely, good work. But we do need to keep one eye on that spending of yours. Long term US interest rates joined oil prices in touching wartime highs (5.00% on the 20-year and $126 respectively) on the last day of the month on Thursday before pulling back a little, continuing their non-confirmation of recent stock market exuberance (see below). Central banks in Europe and the UK held local interest rates unchanged. Q1 US GDP estimates came in stronger than expected, sending the indexes shooting back to new record highs again despite the mixed tech earnings and the PCE index showing inflation continuing to run hot, soaring from 2.8% to 3.5% annualized, the biggest month-on-month increase for years. The S&P 500 scored a 10% jump for the month of April, its best monthly performance since 2020. The Small Cap index and the NASDAQ did even better; up 12% and 16% respectively. Apple reported after the close, beating expectations on most metrics but didn’t blow the doors off and the stock price shifted moderately higher on Friday as stocks began May as they had ended April by marching deeper into record territory with the S&P 500 index now on a five-week winning streak. Some other things I’m thinking about ..* I talked in last week’s report about the divergence between stock market performance and consumer sentiment. Another notable divergence is the one between stock market performance and that of other financial markets. Put simply, compared to the day the ceasefire was declared on April 7th, energy prices are now much higher, as is the 10-year Treasury yield. The S&P 500 index, meanwhile, has surged 9% over the same time frame. * To be clear, this lack of confirmation by oil and interest rate markets doesn’t mean that the rally in stocks is illegitimate. The strong earnings and solid economic data upon which it is based are real. Stock markets are assuming that the war has passed peak intensity and we are at least on a road to some kind of resolution. But neither oil nor interest rates are signaling that and this non-confirmation can be spun one of two ways. * Positively, it could mean that good earnings and economic data are so strong that they are swamping geopolitical concerns, providing an effective offset to event risk. Negatively, it could mean that the stock rally has simply been fueled by “fast money chasing” that has sent mega-cap tech stocks spinning higher on little more than general hope of a resolution and that there is a non-trivial risk that this could all reverse quickly and nastily. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..“Just three months stand between the average American household and bankruptcy.” The death of the American Dream is now official... AND I QUOTE ..“The stock market isn’t always right, but it’s right far more often than any of us trying to predict what will happen next.”Ben Carlson, Ritholtz Wealth ManagementLAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.com* SPYM, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 1.0% last week, is up 5.7% so far this year and ended the week at its all-time record closing high (05/01/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 1.0% last week, is up 13.5% so far this year and ended the week at its all-time record closing high (05/01/2026).* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 0.6% last week, is up 10.0% so far this year and ended the week 1.8% below its all-time record closing high (04/17/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬇︎ 3.68% (3.69% a week ago)* 2 YEAR TREASURY ⬆︎ 3.88% (3.78% a week ago)* 5 YEAR TREASURY ⬆︎ 4.02% (3.92% a week ago)* 10 YEAR TREASURY *** ⬆︎ 4.39% (4.31% a week ago)* 20 YEAR TREASURY ⬆︎ 4.96% (4.88% a week ago)* 30 YEAR TREASURY ⬆︎ 4.97% (4.91% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.<strong...
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Limbo.
Apr 2600:07:18Tap to summarizeThe cozy feeling of optimism that had carried stock markets to new all-time highs the previous week began to unravel over the weekend. Within hours of Trump boasting that "Iran has agreed to never again close the Strait of Hormuz”, Iran again closed the Strait of Hormuz, in response to the US refusal to lift its blockade.The oil price jumped but stocks remained steady in Asia and Europe on Monday. The previously-buoyant mood on Wall Street soured as Trump assured us all that he was not going to extend the ceasefire. Iran cast doubt on its attendance at proposed negotiations in Pakistan. Markets flinched a little and the rally stalled with the indexes all slipping a touch lower. Retail sales data was better than expected on Tuesday morning and stocks rose cautiously when markets opened on ongoing low trading volume before falling back as lingering hopes of imminent US/Iran negotiations evaporated and drove oil prices back into triple figures. The indexes all closed in the red again for their first back-to-back down-days of the month.Just moments after the closing bell, Trump completely reversed course yet again, posting that he was indefinitely extending his ceasefire deadline “until discussions are concluded” while maintaining the naval blockade. Stocks recovered solidly on Wednesday with tech taking the lead but a confused sense of limbo persisted in a vacuum of meaningful war news beyond Trump barking threats on social media, even as more mostly positive earnings reports continued to come out. The indexes defiantly held onto their gains throughout the session and both the S&P 500 and NASDAQ indexes reclaimed new all-time record highs. Earnings from Tesla, IBM and Amex underwhelmed and brutal levels of mass layoffs and voluntary buyouts were announced by both Microsoft and Meta on Thursday. Stocks stagnated, albeit still hovering around record highs and then sank moderately with zero signs of any resolution of the standoff in the Strait of Hormuz. Both sides seem equally desperate to declare victory, but each are terrified of appearing to their domestic audiences to be making any kind of compromise. Energy prices rose for a fifth straight day. A sensational earnings report from Intel, which screamed up by almost 30% at the open to break its record high from 2000 before cooling off a touch, pushed tech stocks sharply higher again on Friday morning. The indexes were then boosted further by the US announcement (notably unconfirmed by Iran) of a possible sequel to the failed high level face-to-face negotiations in Pakistan at the weekend to complete a fourth straight week of gains following four weeks of losses and, of course, at new all-time record highs.I am losing count of the number of times I have been asked recently a version of the question; “How can we possibly be at new all-time highs, given what is going on?” I see a number of reasons:* Financial markets are always forward-looking and anticipatory. A common investor mistake is to conflate events happening right now directly with the real-time daily direction of stock and bond prices. We are probably past peak uncertainty in the war. While the timeline is unclear to say the least, some kind of eventual diplomatic solution is still the most likely outcome.* The biggest market fear has always been that the conflict would send the price of oil spinning above $150 and towards $200 a barrel (at which point we will probably get massive demand destruction that will inevitably cap the price), not about whether its $75, $85 or $95. That $200 scenario remains unlikely, and as long as it stays that way, traders will give the diplomatic process the benefit of the doubt. * The Q1 earnings season is proving to be extremely robust. 80% of companies reporting so far have beaten estimates, some by a lot. At the end of the day, earnings are the prime driver of stock prices.* A strong dip-buying mindset remains alive and well and becomes self-fulfilling as investor reluctance to stay bearish for too long becomes reinforced time and time again by swift bounce-backs in price following any substantial declines.* AI is back, baby! Tech and AI-related names, which are for the most part less impacted by the conflict, are soaring again. Concerns over AI capital expenditure that were rampant earlier in the year have eased and many of these names comprise massive chunks of the weightings of the major indexes.Some other things I’m thinking about ..* This coming week is a highly consequential one. Beyond continued war developments, there’s a Big Wednesday that includes earnings from Alphabet/Google, Microsoft and Meta and a Fed Funds Rate decision (to likely do nothing - see INTEREST RATE EXPECTATIONS below). Amazon and Apple also report during the week. * Fed chairman nominee Kevin Warsh faced a grilling at his Senate confirmation hearing last week, including the accusation that he was simply Trump’s“glove puppet”. Despite his pledge to maintain central bank independence, the troubling signs were there as he declined to say who won the 2020 election and was unable to come up with a single Trump economic policy that he disagreed with. He also refused to come to the defense of Fed colleagues Lisa Cook and chairman Jerome Powell who were at the time both facing vindictive and obviously spurious legal proceedings at the behest of the president (the case against Powell was actually dropped later in the week), choosing instead to fire barbs at the current Fed chairman over recent policy that sounded remarkably like a Trump social media post. Warsh is all but certain to be confirmed by the Senate. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..“Stocks don’t always obey the fundamentals of the backdrop. Because they are owned by people, traded by algorithms created by people and perceptions change as quickly as human emotions.” Ritholtz’s Josh Brown chimes in on the “AI is a bubble” theory... AND I QUOTE ..“They don’t care about gas prices.”American Express CEO Stephen Squeri, on the company’s customers.LAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.com* SPYM, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 0.5% last week, is up 4.8% so far this year and ended the week at its all-time record closing high (04/24/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 0.3% last week, is up 12.4% so far this year and ended the week 1.1% below its all-time record closing high (04/20/2026).* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price fell 1.5% last week, is up 9.4% so far this year and ended the week 2.4% below its all-time record closing high (04/17/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬇︎ 3.69% (3.70% a week ago)* 2 YEAR TREASURY ⬆︎ 3.78% (3.71% a week ago)* 5 YEAR TREASURY ⬆︎ 3.92% (3.84% a week ago)* 10 YEAR TREASURY *** ⬆︎ 4.31% (4.26% a week ago)* 20 YEAR TREASURY ⬇︎ 4.88% (4.89% a week ago)* 30 YEAR TREASURY ⬌ 4.91% (4.91% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.**...
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Happy Clappy.
Apr 1900:05:53Tap to summarizeTo the surprise of almost no-one, the fleeting US/Iran talks in Pakistan over the weekend were a dismal failure. Sometime in between attending UFC fights, unsuccessfully interfering in Hungary’s election, posting an AI image of himself as a messiah and picking fights with the pope, Trump still found time to announce a naval blockade of the Strait of Hormuz in a move designed to cripple Iran financially. The main effect of such a move, of course, is to further deepen the world’s chronic energy supply shock (contemptuously dismissed last week by Treasury Secretary Bessent, net worth around $600 million, as "a small bit of economic pain") that is now resulting in soaring gas prices at the pump for Americans as well as thousands of flight cancelations, fuel rationing, commuting bans and power cuts in other parts of the world. Entirely predictably, the oil price exploded back into triple digits and both stocks and bonds fell in Asia and Europe on Monday. US stocks also initially pulled back but in a relatively orderly fashion and on low trading volume. Trump then claimed that Iran had reached back out that morning to “make a deal” . Oil prices swiftly retreated below $100 and the indexes pushed back into the green, with the S&P 500 index wiping out its losses for 2026 and even closing above where it finished on February 27th, the day before the bombing began, when a barrel of oil cost a mere $67. Q1 earnings season got properly under way on Tuesday morning with decent reports from some of the big banks. We also got another inflation indicator with PPI data proving to be sticky but stable. Stocks continued to march steadily higher throughout the session as energy prices continued to tumble to their lowest levels in three weeks, more on a lack of bad news rather than the presence of anything concrete or credible.An extension of the ceasefire was strongly rumored on Wednesday morning and Trump called the conflict “very close to over”, although Iran pushed back heavily on that claim. Bank of America and Morgan Stanley reported very solid earnings. The indexes drifted gently higher all day and interest rates eased, but it was enough to propel both the S&P 500 and the NASDAQ to new all-time record highs with the former closing above 7000 for the first time ever. This is absolutely astounding six weeks into a deadly oil-impacting war, despite Trump’s bizarre characterization of it last week as just “a minor skirmish”. Wall Street’s happy clappy mood was initially bolstered on Thursday by more pre-market expectation-busting earnings reports from the likes of Taiwan Semiconductor, Bank of New York and Pepsi. Gains were later pared, however, on reliable independent reports of a likely much longer timeline for any US/Iran agreement than the Trump administration is claiming which sent oil prices higher, but the indexes still managed to push deeper into record territory.Netflix reported earnings after the close, providing the season’s first major disappointment relative to expectations but Wall Street’s voracious risk appetite continued on Friday, especially after oil prices plunged following Iran’s initial announcement that the Strait of Hormuz would now be fully open to all traffic (subsequently qualified to exclude ships and cargoes linked to “hostile” countries) for as long as a ceasefire was in place. The indexes extended their upward charge. The S&P 500 completed its third consecutive week of 3%+ gains on a three day record-breaking streak and the NASDAQ also closed at record highs again after scoring its thirteenth straight session in the green, something it hasn’t done since 2013. Some other things I’m thinking about ..* Wall Street is done with the Iran war and ready to move on (see .. AND I QUOTE .. below). We’ve seen this movie many times before where geopolitical crises turn out in retrospect to have been great buying opportunities. The playbook of not freaking out and fading any geopolitical disruption which has essentially worked since the Second World War seems to have played out yet again. US and global indexes fully round-tripped their conflict-related losses and broke to new all-time highs again just a month and a half after hostilities began, marking the third speedy April V-shaped recovery in six years after 2020 and 2025. * Trump went back to taking potshots at Fed chairman Jerome Powell last week, vowing to fire him if he does not give up his governorship position next month, something he is not required to do until 2028. However, as recently affirmed by the Supreme Court, the president has zero legal authority to do this and so Wall Street just rolled its eyes and shrugged it off as a non-story. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..Coast FIRE (Financial Independence, Retire Early) has always been the most sensible diluted version of the somewhat dubious FIRE strategy of aggressive saving, investing and massive cost-cutting to build liquid assets to roughly 25-30X annual expenses and then switching to full spending mode well before traditional retirement age. AI could be causing a rethink. .. AND I QUOTE .."So as far as the stock market is concerned, the war is over until further notice”. Ed Yardeni, president of Yardeni ResearchLAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of stockanalysis.comS&P 500 sector data courtesy of State Street Investment Management * SPYM, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 4.5% in the last five days, is up 4.2% so far this year and ended the week at its all-time record closing high (04/17/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 5.5% in the last five days, is up 12.0% so far this year and ended the week at its all-time record closing high (04/17/2026).* VXUS, an International Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 3.0% in the last five days, is up 11.0% so far this year and ended the week at its all-time record closing high (04/17/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬆︎ 3.70% (3.69% a week ago)* 2 YEAR TREASURY ⬇︎ 3.71% (3.81% a week ago)* 5 YEAR TREASURY ⬇︎ 3.84% (3.94% a week ago)* 10 YEAR TREASURY *** ⬇︎ 4.26% (4.31% a week ago)* 20 YEAR TREASURY ⬇︎ 4.85% (4.89% a week ago)* 30 YEAR TREASURY ⬇︎ 4.88% (4.91% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of Friday’s market close.* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan interest rates such as credit cards, auto loans, personal loans, home equity loans/lines of credit and securities-based lending. *** Used as a basis for determining mortgage interest rates.AVERAGE 30-YEAR FIXED MORTGAGE RATE:* ⬇︎ 6.30%One week ago: 6.37%, one month ago: 6.15%, one year ago: 6.83%Data courtesy of the Freddie Mac Primary Mortgage Market Survey.INTEREST RATE EXPECTATIONS:Where will the Fed Funds interest rate be after the next rate-setting meeting on April 29th?* ...
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Scrambled.
Apr 1200:06:26Tap to summarizeA clearly exasperated Trump put out a series of unhinged expletive-ridden social media posts over the weekend threatening the destruction of civilian infrastructure in Iran starting on Tuesday evening which pushed oil prices deeper into triple digits, but there was very little in terms of credible clarity for traders to chew on at the weekend. A week including some key economic data and the start of Q1 2026 earnings season kicked off quietly on a low-volume Monday session with a temporary pause in the headline roulette and stocks tentatively built on the previous week’s gains in a state of confused optimism ahead of potentially violent two-way volatility from either a brutal US/Israel onslaught or another TACO Tuesday. In fact, Israel seemingly couldn’t wait to start hitting civilian targets in Iran and jumped the gun on Tuesday morning which pushed up energy prices. Trump, who appears to be treating this whole situation like some tawdry New York real estate transaction characterized by shameless brinkmanship and nasty threats, posted that “a whole civilization will die tonight”. A sense of unease settled on Wall Street. Stock prices sank and interest rates drifted higher as the deadline grew closer. However, there was a late-session recovery on the back of rumors of some kind of diplomatic breakthrough brokered by Pakistan and the indexes closed unchanged on the day. After the close, Trump capitulated, announcing a two-week suspension of all strikes on Iran, improbably claiming that the US had “already met and exceeded all military objectives”. In return, Iran agreed to conditionally re-open the Strait of Hormuz for the two-week period (but still charging crypto tolls to any traffic) and bilateral talks were set for the weekend in Pakistan. As both sides desperately tried to spin the narrative as a win including undisguised victory laps with “mission accomplished” rhetoric from both Trump and Hegseth, traders scrambled frantically to re-price risk assets in the wake of the announcement. Oil prices crashed by the most since early COVID, interest rates tumbled and stock markets around the world absolutely skyrocketed in Asia and Europe for their biggest one-day gains in years. When Wall Street opened on Wednesday, its comeback was a little less spectacular, but it was still a very strong day for the stock indexes. While it was unclear how long it would last, traders treated themselves to at least a day of euphoric relief. Some Q1 earnings began to trickle in and were mostly positive ahead of the banks kicking off the season in earnest this week. After Wednesday’s massive dopamine hit, the jubilation subsided across global markets on Thursday with accusations already flying that terms were being violated and the Strait of Hormuz still basically closed.Oil prices and interest rates bounced back higher overnight and international stocks fell. The latest PCE numbers and the most recent Q1 GDP estimate were published ahead of the US opening bell, showing sticky inflation, consumer spending stalling and a declining rate of economic growth. However, reports that Israel and Lebanon were planning direct ceasefire talks helped to reverse early losses on Wall Street and the indexes closed with light gains. The late rebound followed through into Asian and European markets on Friday. Wall Street got to see the latest CPI data which saw inflation shoot up to an annualized rate of 3.3%. The month-to-month jump was the biggest since 2022, but over three-quarters of it was down to war-related energy price increases. Wall Street chose to look through the hopefully-transitory oil price effect and stocks made further incremental gains when markets opened as traders marginally added to bets that the Fed may still cut the Fed Funds Rate at least once this year. This was despite the fact that Americans are feeling miserable right now with the monthly measure of Consumer Sentiment collapsing to the lowest level in history. Trader reluctance to go into yet another highly unpredictable high stakes weekend with meaningful long positions caused prices to ease back to unchanged by the close and the indexes’ best week for months came to a relatively quiet end.Markets are quite heavily banking on the war being in the rear view mirror relatively soon with a noticeable improvement in Strait of Hormuz traffic, even if not back to pre-conflict levels for a while. Whether tolls are going to be charged and exactly to whom they will be paid doesn’t matter much to traders who feel they can probably live with $80-$90 oil for a while. Confirmation of this scenario will likely see a continuation of last week’s solid rally but in the case that everything goes to s**t (possibly as early as this weekend), this rather asymmetric view of things means that renewed significant falls in stock prices are far from off the table if oil prices get back into the $110-$150 range or higher. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..Your brain is buggy software, badly infected with recency bias when it comes investing. Learn to zoom out... AND I QUOTE ..“We won’t applaud those who set the world on fire just because they turn up with a bucket.”Spanish Prime Minister Pedro Sanchez refuses to fully endorse the ceasefire.LAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.comLast week’s best performing US sector: Technology (two biggest holdings: Welltower, Prologis) ⬆︎ 4.9% for the weekLast week’s worst performing US sector: Energy (two biggest holdings: Exxon-Mobil, Chevron) for the second week in a row ⬇︎ 3.9% for the week* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 3.6% last week, is down 0.4% so far this year and ended the week 2.6% below its all-time record closing high (01/27/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 4.0% last week, is up 6.2% so far this year and ended the week 3.8% below its all-time record closing high (01/22/2026).* VXUS, a Global Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 4.9% last week, is up 5.7% so far this year and ended the week 3.6% below its all-time record closing high (02/25/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬇︎ 3.69% (3.70% a week ago)* 2 YEAR TREASURY ⬆︎ 3.81% (3.79% a week ago)* 5 YEAR TREASURY ⬌ 3.94% (3.94% a week ago)* 10 YEAR TREASURY *** ⬌ 4.31% (4.31% a week ago)* 20 YEAR TREASURY ⬆︎ 4.89% (4.88% a week ago)* 30 YEAR TREASURY ⬆︎ 4.91% (4.88% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of the market close on Friday* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan...
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No Peace.
Apr 500:06:15Tap to summarizeReports predicting an imminent US ground invasion of Iran intensified over the weekend, triggering an apocalyptic response from the Iranians. The Houthis in Yemen joined the ever-expanding conflict, likely at the behest of Iran, complicating the increasingly chaotic picture further. Trump ramped up his attempts to gaslight markets with a flurry of detail-free promises of an imminent deal one minute then wild threats of hellfire the next but, given a complete lack of anything credible to digest, Wall Street just isn’t listening any more. For most of Monday US stocks did a whole lot of nothing with traders unsure as to what posture to take in a vacuum and no trustworthy information coming from any of the conflict participants. But the indexes swooned late in the session to finish in the red again with the S&P 500 creeping closer and closer to official correction territory. A very rough month and quarter (see my Q1 Market Review here) came to an end at long last on Tuesday with the oil price at a four-year high following its biggest monthly jump in history and US gas prices at the pump averaging above $4/gallon for the first time since mid-2022 and rising, with some places in California seeing closer to $7. However, the indexes roared higher for their best one-day session in close to a year which was put down to dip buyers and bargain hunters finally showing up on the back of Iran signaling possible co-operation in ceasefire talks and end-of-quarter window dressing which can often create some distortions on the final day. Trump’s incoherent, jumbled flip-flopping continued after the close. He pledged to bomb Iran “back into the Stone Ages”, end the war in two weeks’ time and touted peace negotiations, all in literally the same sentence. He then promised to grace us all with even more of this kind of insight in a primetime address to the nation the following day. Q2 kicked off on Wednesday and stocks followed through strongly on Tuesday’s monster rally following spectacular gains in Asia and Europe with a perception that it may be dawning on Trump that the current status of the war is untenable with his approval ratings in the toilet and the midterms coming up in a few months. The president’s “very important” twenty-minute address was anything but. It was no more than a rambling, self-serving verbal summary of his recent social media posts and gave traders nothing new to work with. Hard to believe, but Thursday was the one year anniversary of so-called “Liberation Day” and the subsequent market disruption caused by the tariff strategy, but attention is very much focused elsewhere at the moment. Asian and European markets fell back after the letdown of Trump’s disappointing update and Iran’s “bring it on, motherf*****” -style response offered no peace. Wall Street initially followed the lead of overseas markets with the indexes giving back some of Wednesday’s gains as energy prices rocketed higher again on the prospect of at least two or three more weeks of escalating bombardment in the region and Trump’s bizarre reference to some kind of magical “natural” self-opening of the Strait of Hormuz. A late mini-surge dragged stock prices back to basically flat for the session and pushed interest rates lower ahead of the long weekend. A Jobs Report released on a Friday when the stock market was closed meant that we aren’t going to get to see any equity market reaction until Monday and that reaction could easily be swamped by geopolitical developments over the weekend. It was a very solid report with new job creation above even the highest estimates and a fall in the unemployment rate to 4.3%, although downward revisions to prior data took off some of the shine. Some other things I’m thinking about .. * Going into a trading blackout with a high level of unknowable risk is an unsettling thought for Wall Street traders. This is leading to a relatively predictable pattern of end-of-week selling as relative optimism is typically replaced by risk aversion as the week goes on. Since the Iran war began, the S&P 500 has actually posted cumulative gains over the first three days of the week but has fallen 9% on Thursdays/Fridays. The rationale is simple; a lot can happen in the war during a two-day untradeable period, especially given Trump’s habit of deliberately announcing disruptive policies when US financial markets are closed. * After Trump’s nothing-burger address on Thursday provided no clues, traders have begun to scan the calendar for indications of when this war might end. The only event that really jumps out is the mid-May meeting between Trump and Chinese premier Xi. That’s still a long way off. * Nevertheless, after the best weekly gain of the year for stock markets, the bulls may be starting to chomp at the bit and the bears suddenly look a bit twitchy as Trump looks for an off-ramp to the unpopular war which has clearly not gone as breezily as he assumed it would. The sense is growing that this stock market may soon begin to look for excuses to head north instead of for reasons to sell. If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..It’s a disgrace that this is being permitted. If this crap shows up in your 401k or 403b anytime soon, do NOT go anywhere near it!.. AND I QUOTE ..”You need nearly twice as much income today to afford the typical US home compared to before COVID.”Nick Maggiulli, Ritholtz Wealth ManagementLAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.comLast week’s best performing US sector: Real Estate (two biggest holdings: Welltower, Prologis) ⬆︎ 3.3% for the weekLast week’s worst performing US sector: Energy (two biggest holdings: Exxon-Mobil, Chevron) ⬇︎ 3.7% for the week* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 1.7% last week, is down 3.8% so far this year and ended the week 6.0% below its all-time record closing high (01/27/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 1.6% last week, is up 2.1% so far this year and ended the week 7.5% below its all-time record closing high (01/22/2026).* VXUS, a Global Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 3.0% last week, is up 2.7% so far this year and ended the week 8.1% below its all-time record closing high (02/25/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬇︎ 3.70% (3.73% a week ago)* 2 YEAR TREASURY ⬇︎ 3.79% (3.88% a week ago)* 5 YEAR TREASURY ⬇︎ 3.94% (4.06% a week ago)* 10 YEAR TREASURY *** ⬇︎ 4.31% (4.44% a week ago)* 20 YEAR TREASURY ⬇︎ 4.88% (4.99% a week ago)* 30 YEAR TREASURY ⬇︎ 4.88% (4.98% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of the market close on Friday* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used...
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Chain Yanked.
Mar 2900:05:50Tap to summarizeOver the weekend Trump threatened to massively raise the stakes by bombing Iranian energy plants if the Strait of Hormuz (which had been closed for 24 days and counting) wasn’t open by Monday night, alarming Asian markets and US stock and bond futures. Just three hours before markets opened in the US on Monday, however, he posted that there were direct negotiations going on between an unidentified “top person” in Iran and the US that had been productive and he was postponing such attacks by five days since Iran “is begging to make a deal”. News that any peace talks were happening at all was a surprise not only to Wall Street but also apparently to the Iranians, who quickly denied any such dialogue or an inclination to end the conflict. A confused and increasingly war-weary stock market is clearly not enjoying having its chain yanked by a small number of social media accounts that increasingly feel like they are trying to manipulate asset prices via tactical releases of not always entirely accurate information. Nevertheless, traders still backed off some of their more pessimistic bets and the stock indexes whip-sawed higher with a wild 3%+ swing in the S&P 500 from the pre-open lows to late-morning highs and closed deep in the green, although well off session highs, as oil prices, interest rates and gold all dropped meaningfully lower. Monday’s cautious optimism failed to extend into Tuesday’s session with no let up in missile strikes in the region and the brief sharp decline in oil prices and interest rates came to a swift halt. The stock indexes meandered around aimlessly trying and failing to read mixed and sometimes contradictory war signals, eventually closing a touch lower. Oil prices drifted lower overnight and continued to set the tone for stocks which jumped higher again on Wednesday morning, as some traders began positioning for possible conflict resolution with both sides apparently floating (vastly different) proposals. Stocks have had a tendency of late to recover quickly and violently from geopolitical shocks and getting caught on the wrong side of such a move by acting on excess pessimism has proven to be painful in many cases. It was this notion that kept prices higher through the close. However, ceasefire hopes began to fade on Thursday as each side laughed off the other’s proposal and anchored to their extremes. Oil prices and interest rates resumed their climb and stocks sank again as the reward vs. risk calculation of putting on additional long positions ahead of what could be a volatile weekend started to deteriorate. Trump’s increasingly unconvincing attempts to paint a rosy picture at a cabinet meeting failed dismally to impress Wall Street and in response the stock indexes plunged further to levels not seen since September last year (albeit on relatively light volume), with the tech-heavy NASDAQ leading the nosedive and falling into official correction territory, to complete what was a truly horrible session for stocks. After the closing bell, Trump delivered yet another of his now-famous TACO moments (they do always seem to occur right after a bad day in the stock market), extending his energy attack deadline by ten days. This did nothing to stem the bleeding however and the indexes (once again led by the NASDAQ) continued to crap out on Friday to close out another torrid week of losses. The five straight weeks in the red is the S&P 500’s worst streak since the Russian invasion of Ukraine in early 2022. Some other things I’m thinking about .. * Last week highlighted the current schizophrenic market reaction to the war; traders are afraid to be uninvested or short in case markets scream rapidly higher on some kind of resolution while they are also afraid to go risk-on as the odds increase that the fallout could be extensive and long-lasting. Which of these two positions seems to be the most reasonable changes literally from day to day, with the latter more in vogue than the former right now.* Trump may be steadily losing control of the situation, as most observers feared he would. As the quote below from Neil Dutta suggests, there are three major players involved in this conflict: the US, Iran and Israel. While the US may be keen on a ceasefire and a victory lap for its own domestic reasons, it’s not guaranteed that i) Israel will agree or abide by a cessation of hostilities, or ii) Iran will agree or abide by it. Case in point, Israel is continuing its ruthless operation in Gaza, has now opened a new invasion front in Lebanon and is bombing Iranian energy infrastructure. Unlike with tariffs, Trump cannot just flip a light switch here.If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.ARTICLE OF THE WEEK ..How to trade the war. Don’t. .. AND I QUOTE ..”You can’t TACO when you’re not the only party involved”Neil Dutta, Head of Economic Research, Renaissance Macro ResearchLAST WEEK BY THE NUMBERS:Last week’s S&P 500 market color courtesy of finviz.comLast week’s best performing US sector: Energy (two biggest holdings: Exxon-Mobil, Chevron) for the fourth week in a row ⬆︎ 5.5% for the weekLast week’s worst performing US sector: Communication Services (two biggest holdings: Google, Meta) ⬇︎ 4.6% for the week* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price fell 2.2% last week, is down 7.0% so far this year and ended the week 9.1% below its all-time record closing high (01/27/2026).* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 0.3% last week, is down 1.2% so far this year and ended the week 10.5% below its all-time record closing high (01/22/2026).* VXUS, a Global Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price was unchanged last week, is down 1.0% so far this year and ended the week 11.4% below its all-time record closing high (02/25/2026). INTEREST RATES:* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)* 3 MONTH TREASURY ⬇︎ 3.73% (3.74% a week ago)* 2 YEAR TREASURY ⬌ 3.88% (3.88% a week ago)* 5 YEAR TREASURY ⬆︎ 4.06% (4.01% a week ago)* 10 YEAR TREASURY *** ⬆︎ 4.44% (4.39% a week ago)* 20 YEAR TREASURY ⬆︎ 4.99% (4.97% a week ago)* 30 YEAR TREASURY ⬆︎ 4.98% (4.96% a week ago)Data courtesy of the Federal Reserve and the Department of the Treasury as of the market close on Friday* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan interest rates such as credit cards, auto loans, personal loans, home equity loans/lines of credit and securities-based lending. *** Used as a basis for determining mortgage interest rates.AVERAGE 30-YEAR FIXED MORTGAGE RATE:* ⬆︎ 6.38%One week ago: 6.22%, one month ago: 5.98%, one year ago: 6.65%Data courtesy of the Freddie Mac Primary Mortgage Market SurveyINTEREST RATE EXPECTATIONS:Where will the <a target="_blank" href="https://simonbrady.subs...
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