Providing timely updates and perspectives on the economy and financial markets.
Weekly Market & Economic Update | 04.15.19
First quarter earnings season started with solid reports from JP Morgan and PNC Bank, providing support for stocks. We saw economic improvements outside the United States while data continued to show the U.S. struggling.
As expected, the Federal Reserve (Fed) kept rates unchanged following the March 20 meeting. The Committee reiterated that future rate changes will be data dependent, noting U.S. economic data is “in a good place” despite slightly reducing expectations for growth and increasing unemployment estimates.
As we exit the first quarter, a “gap” seems to exist between asset price performance and global economic performance. Our analysis suggests that U.S. economic data has generally softened and the global economy is on a path of a re-synchronized slowdown.
As we look ahead to 2019, prospects for the coming year look a bit less clear than has been the case in recent years.
Our positioning remains neutral, with a cautious bias on the high-yield category (which includes bank loans, as growing risks in the loan market warrant caution, despite strong recent performance.