Market Update – May 2022
I expect some readers will recall an electronic board game called “Operation” from their youth. Despite knowing the artificial “jolt” would eventually come it was uncanny how the human reaction was to jump with each eventual failure. This reaction comes to mind when considering the response of fixed income investors to the first rate hike in the monetary tightening cycle which began in March.
Market Update – April 2022
The Federal Open Market Committee (FOMC) raised short term rates in March for the first time since 2018. Maintaining their proclivity for transparency, they quickly announced expectations for the possibility of six more hikes this calendar year (with the market already pricing in more) to slow the pace of rising inflation.
Market Update – March 2022
Russia’s invasion of Ukraine overshadowed all other news in the final trading week of February. The initial panic selling on Wall Street turned around quickly on the day of the military attack.
Market Update – February 2022
The stock market was incredibly volatile in the first month of 2022, reflecting fears of Fed policy tightening. Higher interest rates meant lower stock prices, as investors able to earn higher yields on risk-free U.S. Treasury bonds were less interested in buying technology stocks with questionable profitability.