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Showing posts with the label stagflation

Trading Day: Market elation trumps brewing stagflation

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[hfe_template id='11223'] [ad_1] If anyone wanted a snapshot of the tight spot the U.S. economy and policymakers are in right now, they got it on Friday via the University of Michigan's latest consumer sentiment and inflation expectations survey. The results were eye-popping: consumer sentiment expectations are now the lowest since 1980 and one-year inflation expectations are the highest since 1981, above 6%. Sentiment surveys are only 'soft' data and there is much debate whether they translate into the 'hard' activity data like retail sales and hiring. Fed Chair Jerome Powell said earlier this month the link between the two in recent years has been "weak" and he has previously downplayed the U-Mich inflation expectations figures. But the direction of travel is getting harder to ignore. Consumers are spooked by President Donald Trump's trade war and fear tariffs will push up prices, forcing them to curtail spending. If this soft data ...

Battered Wall Street short brigade is refusing to admit defeat

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[hfe_template id='11223'] [ad_1] Just like that, the panic on Wall Street has vanished almost as quickly as it arrived.Only weeks ago, traders from Singapore to New York were bracing for the economic fallout from President Donald Trump’s trade war. Global markets had shed trillions in value and American financial dominance faced its sharpest scrutiny in years. Now, the investment landscape looks markedly different. Trump is touting tariff progress on a near-daily basis — helping cool stagflation concerns while pumping up the “buy America and fade the fear” narrative once more. In turn, risky assets have mounted a swift rebound. The S&P 500 has just closed out its second-best week of the year, while credit and crypto have rallied anew. Yet for all that, a cohort of naysayers is pushing back. Short interest in the world’s biggest exchange-traded fund tracking the Nasdaq 100 has grown and now sits almost three times its February low. And in corporate bonds, bearish posi...

Wall Street Week Ahead: Rocky US stock market faces inflation data test

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[hfe_template id='11223'] [ad_1] A critical inflation report in the coming week could further rattle an increasingly tumultuous U.S. stock market, with investors worried about an economic growth slowdown and President Donald Trump's tariffs. Despite a gain on Friday, the benchmark S&P 500 marked its worst week in six months. The tech-heavy Nasdaq Composite on Thursday ended down more than 10% from its December all-time closing high, confirming it has been in a correction for several months. Investors were grappling with dramatic policy change around the world. Trump's back-and-forth implementation of fresh tariffs on Mexico, Canada and China exacerbated broad concerns about the economy. Markets were also shaken by Germany's surprise spending plans, which drove a selloff in the benchmark German Bund. As recent U.S. economic data has disappointed, one silver lining for stocks has been markets factoring in more interest rate cuts by the Federal Reserve this...