What’s going on?
During the last five trading days the U.S. stock market has risen and fallen almost 300 Dow points (that’s the Dow Jones Industrial Average) four times. At the same time the yield on the 10-year Treasury has fallen to 2.3%, oil trades near $85 a barrel and the U.S. dollar has continued its rally. One day people are worried about faster U.S. economic growth and higher interest rates…and the next they are excited about slower growth in Europe and more central bank stimulus.
This quarter’s Financial Insights describes the divergences taking place in global central bank policy, interest rates and small and large capitalization stocks and how they are impacting volatility and asset prices. We hope that the newsletter brings some clarity to what’s going on and how we are thinking about portfolio positioning.
Caution Divergence Ahead! Click here to download the PDF .