Last week, the S&P 500 suffered its worst weekly loss since the COVID-19 pandemic selloff in March 2020. The benchmark index capped its third-straight weekly loss and ended Friday below its 200-day moving average for the first time since June 2020. With prospects rising for a faster-than-expected Federal Reserve rate liftoff, the sell-off on the tech-heavy Nasdaq Composite was even worse.
With volatility picking back up, it's important to remember how far markets have rocketed upward amidst an economy that is still in recovery mode. Navigating inflation in this recovery will be the biggest challenge for the central bank.
Here's what we are reading this week:
Weekly Commentary - Trimming our Treasury underweight - BlackRock
BlackRock reduced an underweight to U.S. Treasuries (in their investment portfolios) after the surprising yield surge this month while still seeing the direction of travel for yields as higher.
Bond yields hit highs and stocks fell last week. They view the yield surge as a reallocation away from government bonds and not necessarily bad for equities.
The Fed is meeting this week amid market expectations of aggressive tightening later this year. More than one-fifth of S&P 500 companies are reporting results.
Navigating Investments in 2022 - Capital Group
Capital Group's investment team looks at 5 ideas for investing this year; including volatility in mid-term election years and possible inflation-participatory equities.
10 Things You Should Know About Stock Market Volatility - Hartford Funds
It would be nice if your investing journey was always a steady uphill march. In reality, it’s more of a sometimes run/sometimes crawl with plenty of downhill moments along the way. In spite of the obstacles, over time, the path typically trends upward. The bumps of stock market volatility are an inescapable part of the investment experience, but with some context, they don’t have to be so scary.
Hartford reminds us it's important to our volatility in perspective.
The views stated in this post and the links provided are not necessarily the opinion of First Allied Securities Inc. and should not be construed directly or indirectly as an offer to buy or sell any securities mentioned therein. Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results. Investors should consider their financial ability to continue to purchase through periods of low price levels. All investing involves risk, including the possible loss of principal.