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Market Outlooks
AAM Viewpoints: Buying Low and Selling High is Preferred
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The historically low yields of 2020 forced many income-seeking investors to take on additional risk. First, they may have increased their duration exposure to capture the higher yields offered by longer-dated maturities. Or secondly, they may have migrated to “riskier” assets such as high yield corporate bonds as fiscal and monetary policy aimed to stimulate economic growth.
Market Outlooks
PULSe Indicator: Pandemic Factor Rises to Crisis Levels
To help navigate turbulent markets, we constructed the PULSe indicator. At the end of December, the indicator was Stable.
Market Outlooks
AAM Viewpoints: The Low Yield Environment and Corporate Credit Trends
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Outside of the oil crises, U.S. real yields have never been lower and global negative yield debt reached a record $18.38 trillion on 12/11/20, and as of Tuesday, 2/16/21 stands at $14.74 trillion. The U.S. 10-year Treasury real yield hit an all-time low on 8/6/20 at -1.08% and again on 1/4/21. It now stands at -1.04%. The previous low was in December 2012 at -0.92%.
Market Outlooks
AAM Viewpoints: Municipals Do Their Best Tortoise Impression and Play Catch Up
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Slow and steady wins the race, or so says Aesop. After playing the post-COVID investment grade laggard for the majority of 2020, the municipal market’s consistent slow-paced nature has them playing catch up through the first 25 trading days of 2021. While municipals enjoyed a healthy 5.21% year-to-date return for 2020, that was still behind U.S. Treasuries by 279 bps (basis points) as well as U.S. Investment Grade Corporates by a staggering 468 bps.
Market Outlooks
AAM Viewpoints: The Pandemic: A Credit Epilogue
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Introduction: While the COVID-19 crisis is not yet over, with cases recently spiking again, the vaccines are being administered and there appears to be a light at the end of the tunnel. It still remains to be seen whether new consumer behavior will stick or revert to pre-pandemic patterns.
Market Outlooks
U.S. Presidential Elections and Stock Markets
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Historically, market returns helped predict presidential election outcomes, but using election dates for market timing is inconclusive.
Market Outlooks
The Government Responds with Extraordinary Measures
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The Federal Reserve and Washington lawmakers have taken dramatic steps to counteract the effects of the COVID-19 virus on the economy.
Market Outlooks
Global Asset Allocation Viewpoints and Investment Environment
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Pledges of fiscal spending have been quick to follow actions taken by major central banks to combat the looming impacts of the coronavirus pandemic. G-20 countries have pledged more than $5 trillion USD in stimulus through a wide range of avenues to stave off the effects on the global economy.
Market Outlooks
View of the Business Cycle by Fidelity's Asset Allocation Research Team
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A review of the current state of the U.S. business cycle and the effects of the spread of COVID-19, as well as the potential implications for asset allocation.
Market Outlooks
Strong Fiscal Response Needed After Fed Moves on Liquidity
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The failure of the Fed's rate cut to calm markets has put pressure on governments to provide a stronger fiscal response.