Market Commentary

In this episode of Money with Murphy, Kara Murphy dives into the evolving landscape of U.S. tariffs. From their historic use to Trump's 1.0 and proposed 2.0 plans, she explains their impact on industries, trade deficits, and inflation. Learn how these measures could shape consumer prices, business strategies, and even Federal Reserve decisions.

The 2024 election season was one for the books, but despite a dramatic campaign and geopolitical uncertainties, markets showed surprising resilience. Following the decisive outcome, stocks surged, led by financials, crypto, and small-cap stocks, as investors shifted their focus from politics to policies. The “pre-election trade” sparked sector gains and influenced bond yields, hinting at potential inflationary pressures. Now, with political uncertainty behind us, the market's attention is set on key issues such as deficit levels, interest rate decisions by the Federal Reserve, and possible tax policy changes. Dive into our analysis to see how these factors could shape the financial landscape ahead.

This week marks one of the busiest periods of the year for markets, with major economic data releases, the final days of the presidential campaign, and a wave of corporate earnings reports from nearly half of the S&P 500. Key players like Google, Microsoft, and Apple are set to reveal their Q3 results, potentially shaping the market’s direction. Here’s what we’ve seen so far in earnings season and what to keep an eye on in the days ahead. 

Last week was packed with market activity, including key earnings reports, economic data, and a shifting jobs picture. About a third of S&P 500 companies reported their Q3 earnings, with most beating estimates but while high-expectation stocks like the "Magnificent 7" struggled to impress. Meanwhile, job growth stalled, and manufacturing data pointed to a slowdown, hinting at potential economic challenges ahead. With rising treasury yields and mixed signals across sectors, the Federal Reserve faces a delicate balancing act in its upcoming meeting. 

Kara Murphy, CIO, KIM takes a look at the critical role small businesses play in the U.S. economy, making up nearly half of the nation's workforce and 44% of its GDP. While optimism is up from recent lows, small businesses still grapple with inflation, labor shortages, and uncertainty. Kara breaks down recent hiring trends, challenges facing business owners, and emerging signs-of-hope as inflation cools and retail sales pick up. Tune in to see how small businesses are navigating these economic shifts and what it could mean for economic growth.

The third quarter of the year was marked by significant market volatility amidst unexpected political events and mixed economic data. Despite these challenges, markets showed resilience, with all major asset classes finishing the quarter in positive territory. Looking ahead, investors face ongoing risks, including U.S. election uncertainties, global conflicts, and economic pressures. To navigate these challenges, maintaining a focus on long-term economic fundamentals and a balanced investment strategy will be crucial. 

In this episode of Money with Murphy, we look at drivers of volatility and reasons for resiliency in markets during the third quarter of 2024. From Fed rate cuts and shifts in the Yen to geopolitical tensions and surprising market rallies, Q3 had no shortage of market-moving events. With major asset classes showing strong year-to-date returns, Kara Murphy breaks down how global developments impacted markets and what lies ahead for investors in the coming months. Tune in for an insightful recap and key takeaways.

As the 2024 presidential election heats up, investors are eager to understand how the candidates' policies might impact the economy. With Vice President Harris now running against former President Trump, this race has seen plenty of political debate but fewer concrete policy details. In this week’s Markets in a Minute, Kara breaks down where they stand on critical issues like taxes, tariffs, and the national deficit, offering insights into the similarities and differences that could shape the economic landscape.

The Federal Reserve’s recent rate cut—the first since the pandemic—raises important questions about how it will affect your finances. In this blog, Kara Murphy breaks down the potential impacts on mortgages, auto loans, and credit cards, revealing why the Fed’s decision doesn’t always lead to lower borrowing costs across the board. Kara also explores what it means for savers and investors, providing insights you might not expect.

Success doesn’t happen overnight, whether you’re building a championship football team or a winning investment portfolio. Just like NFL scouts assess potential players, investors must evaluate funds carefully through quantitative and qualitative screening to find the right fit. In this edition of Markets in a Minute, we break down our due diligence process and explain how a disciplined approach to ETF selection can help you achieve your financial goals. Plus, since football season is upon us, we’ve sprinkled in a few game-day analogies to keep it fun!

As the world’s top economists and policymakers gather at Jackson Hole, all eyes are on the Federal Reserve and the delicate balancing act they face. This year’s Jackson Hole Economic Symposium will spotlight the difficult trade-offs that define the Fed’s dual mandates, setting the stage for potential shifts in monetary policy that could ripple through markets. Dive into the complexities of these decisions and what they could mean for the economy in the months ahead in this week’s Money with Murphy. 

Q2 2024 earnings season reveals a mixed but resilient landscape. While 78% of S&P 500 companies surpassed earnings expectations, the magnitude of these surprises is below the 10-year average. The "Magnificent 7" tech giants are driving most of the growth, while a growing number of consumer discretionary companies are underperforming due to changing spending habits. With shifts in consumer behavior and macroeconomic headwinds impacting certain sectors, this earnings season offers key insights into the evolving economic landscape.

Investors often have their favorite market indicators such as stochastics and Bollinger bands. Well one of Kara’s is what she calls, the Mom Indicator. Yesterday, that indicator was triggered. While on her way home from the office, she got a call from her mom, saying something like, “Kara, the Dow is down ONE THOUSAND points. What’s going on? I’m losing money!” When Kara gets that kind of call, she knows that Main Street investors, like her mom, are worried about market volatility. And that concern is understandable, market indexes in the US and across the world have been walloped. Hear more of Kara’s thoughts on recent market turbulence in this week’s Money with Murphy. 

As the 2024 Summer Olympics begin, France is not just chasing gold medals but a massive economic gamble. This week's Markets in a Minute uncovers the controversial history of the Olympics' economic impact, asking if the multibillion-dollar investment will pay off or leave Paris with a financial hangover. With a staggering $8.2 billion price tag, can Paris defy the odds and turn a profit, or will it join the list of host cities left reeling from Olympic-sized debts? Dive in to discover the real score behind the games.

In March 1968, when LBJ announced he would not seek re-election, the S&P 500 climbed nearly 13% over the next year, and the Democrats lost the presidential race. After the Reagan assassination attempt in March 1981, the S&P 500 fell by 16% over the following 12 months. Within a single week, the nation faced both an assassination attempt on a former president/presidential candidate and a sitting president deciding not to seek re-election. How should investors respond? 

In Q2, the S&P 500 continued its strong performance, gaining 5% for the quarter and 15% year-to-date, driven largely by the technology sector. While emerging and developed market equities outside the US also saw gains, the bond market struggled due to persistent inflation and delayed interest rate cuts. Economic indicators were mixed; job growth remained solid, but the unemployment rate rose, and consumer spending showed signs of strain. Looking ahead, inflation and labor market conditions will be crucial, with potential interest rate cuts and political uncertainty adding to market volatility. Read more in this week’s Markets in a Minute.  

Investors have understandably been fixated on the trajectory of inflation, interest rates and other headline-grabbing economic issues. Over time, though, the economy and markets are at least as impacted by demographic shifts. In this week’s Markets in a Minute, we examine the so-called silver tsunami, a global demographic trend with implications for investors and policymakers alike.

In this week’s Money with Murphy, Kara delves into the complexities of inflation, examining its recent trends and future implications. Two years ago, prices were soaring at unprecedented rates, but they've since slowed down thanks in part to higher interest rates from the Federal Reserve. We explore whether inflation is still high, why it matters to consumers, and what the future might hold as markets anticipate interest rate cuts.

Earlier this month, I spent a chaotic eight hours in the Austin-Bergstrom airport when severe weather delayed hundreds of flights, stranding thousands of passengers, including myself. Not exactly how I planned to spend a day off. Yet the long stint in the airport – one that I’ve breezed through countless times – served as a reminder of how easy it can be to take infrastructure for granted. 

Infrastructure is the kind of thing we hardly notice until it breaks down, leaving us stuck on a road, in an airport or on an internet connection that wasn’t built to handle so much traffic. In this week’s Markets in a Minute, we look at the global race to expand and upgrade infrastructure and implications for investors. 

In this special episode of Money with Murphy, Bobby Gomez, Head of Investment Specialists, KIM, joins Kara Murphy to examine the implications of recent unprecedented political events as the presidential election looms. With high-profile legal cases in the spotlight, Kara and Bobby pose critical questions we should all be asking: Are investors letting their feelings of political bias influence their economic outlook? And how to navigate the emotional rollercoaster of election season to make sound financial decisions? 

Last week, we discussed investing during the presidential election. This week, we delve into political risk beyond US borders, examining recent global conflicts and their potential impact on investment strategies. Despite geopolitical tensions, market indicators suggest a surprising calm. Kara shares her thoughts on the most effective strategy for navigating uncertain geopolitical landscapes and managing investment portfolios wisely in this week’s Money with Murphy.

While a party or individual in office can shade economic perceptions, they rarely define the direction of the overall market once a new president is in place. A defining feature of the American political system is the strength of its institutions, which have provided enviable stability for nearly two hundred and fifty years. While politics and our candidates are incredibly important for certain policies, the impact that any one individual can have on the overall market is limited. Kara discusses election years broadly and what’s happened so far this year in this week’s Markets in a Minute.

Last week, we got the first evidence in months that the job market is weakening. In April, 175,000 new jobs were created. That level of job creation, while still quite robust, was lower than expected and marks the lowest level of new jobs in about a year. In addition, the unemployment rate ticked up slightly to 3.9%, suggesting that more people are looking for work. Kara goes under the hood and picks apart some of these numbers, and why weakening in the job market may be a good thing in this week’s Money with Murphy.

If you’ve bought a house in the past four years, then you know how difficult it has been to navigate the housing market. In 2021, houses in certain parts of the country were sometimes selling for 20-30% over asking price. While the average price for a home has retreated from its peak, prices remain well above pre-pandemic levels and interest rates are at multi-decade highs, making the cost of owning a home more expensive than ever. Over the last two weeks, recent data releases suggest some reprieve, yet challenges still abound.

From Cleopatra’s attempts to use alchemy to turn lead into gold, to California’s gold rush that drew hundreds of thousands of fortune seekers, gold has long been highly sought after. More recently, gold recently reached its all-time high, up over 16% this year, compared to the S&P up just 5%. Unlike other precious metals such as silver and platinum, gold has very limited practical uses. Most gold is used as either jewelry or currency. So why the sudden interest in gold among investors? This is a harder question to answer than you might guess. 

The US economy continued to show resilience despite elevated inflation and high interest rates, dampening expectations of interest rate cuts. The broad stock market gained more than 10%, its best start to the year since 2019. All but one S&P 500 sector saw positive returns, a sign of healthier levels of market breadth than in 2023. Kara discusses this and more in this week’s Markets in a Minute.

In the first quarter of this year, the S&P 500 had an impressive start, ending the quarter up over 10%, its strongest first quarter since 2019. The story surrounding the Magnificent Seven has changed and a variety of other names have taken the lead, allowing the market to broaden out. Gold is back in the headlines, finishing up 8% in Q1, hitting all-time highs nearly half of all trading days in March alone. Find out what else happened in this week’s Money with Murphy. 

Since the beginning of the year, the average price of a gallon of gas in the US has jumped 14%, denting many consumers’ wallets and complicating the Federal Reserve's inflation control efforts. These increases may trigger memories of the steep inflationary surge in gas and other commodities during the COVID era. In June 2022, gas prices nearly doubled from their pre-COVID level to almost $5.50 per gallon. How will higher gas prices impact consumers and ultimately Fed policy? Kara Murphy shares her thoughts in this week’s Money with Murphy.

Last week, the Federal Reserve announced no change to interest rates and threw water on any hopes for a rate cut at its next meeting in May. This more-tempered outlook for interest rates stands in contrast to market expectations in late 2023. In November of last year, after nearly two years of sharply rising interest rates, Fed officials first spoke of rate cuts. In celebration, markets rallied in what became known as the “pivot party.” So why the newfound caution? Find out in this week’s Markets in a Minute.

Corporate earnings grew by 4% compared to the previous year, with nearly 75% of companies reporting earnings that were better than expected. While those beat rates were more or less in line with historic averages, they also confirmed that corporate America is indeed growing again. Q4 marked the second quarter in a row of improved earnings after three consecutive quarters of earnings declines. Kara discusses what other trends stood out in this week’s Money with Murphy.

Beginning in the early days of Covid, supply chains around the world became snarled, making it difficult to find everything from couches to computer chips for automobiles. While inventory levels of most manufactured goods have since returned to normal levels, some supply chains are threatened anew by geopolitical and environmental stress in key shipping channels such as the Red Sea and the Panama Canal. As the Fed continues to wrestle with inflation, how much impact could these shipping disruptions have on inflation and the global economy?

The Dow Jones Industrial Average, or “The Dow”, is one of the oldest and most widely followed stock indices in the US. First published in 1886 by Charles Dow, the index consisted of 12 industrial companies. Since then, it has grown to 30 companies and has tilted further away from its industrial roots. But should you care about the Dow? Kara answers this and addresses the flaws of the Dow in this week’s Money with Murphy. 

Over the course of 2023, seven of the largest stocks in the United States collectively doubled in value, earning the moniker “The Magnificent 7.” After such impressive performance, what comes next?

Can the Super Bowl predict the stock market? The Super Bowl indicator was first introduced in 1978 by sports reporter Leonard Koppett, arguing that a win by a team from the NFC meant the stock market would likely go up that year. The indicator had an impressive success rate of 95% for more than thirty years. More recently, however, the indicator has had a much less convincing track record of predicting market moves, including the last two times that the Kansas City Chiefs won.

One month into the new year, and one thing’s for certain: The presidential election will continue to grab headlines and grip the nation’s attention for the better part of 2024. How might this impact investors in terms of perceptions and actual market performance? We explore these questions, in the context of historical data, in this week’s Markets in a Minute.