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Stock Market Volatility: Could These Be Future Considerations for Investors?

Posted by WrapManager's Investment Policy Committee

February 16, 2018

Money Managers continue to reflect on the market volatility from last week, lessons learned, and consider what's to come.

This week's post is another compilation of articles from three different money managers. Lord Abbett's day-by-day recap of last week's market ups and downs. Senior Portfolio Manager Bob Doll shares Nuveen's outlook on market volatility and other factors investors should consider, while Federated Investors focuses in on dividend investing in 2018.


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Federated Investors Inc Lord Abbett Company Llc Nuveen Asset Management market perspective Market Volatility Money Manager Commentary

Money Manager Commentary: Why Was the Market So Volatile This Week?

February 8, 2018
Money Managers have had plenty to say about the market volatility that started last week. That’s why this week we’re doing something different. The post below is a compilation of five different commentaries. As usual, you can read the excerpt below, or click the link to download the full version of each of the individual commentaries. Keep reading to see what the following money managers say about this week’s volatility. Lord Abbett and Company Cambiar Investors Nuveen Asset Management Federated Investors ClearBridge Investments [+] Read More

Nuveen Evaluates Rising Risks, Recommends Pro-Growth Bias

January 25, 2018
We are not yet seeing warning signs that would signal a correction... Over the past 18 months, investor sentiment appears to have come full circle. In mid-2016, deflation fears reigned and investors seemed eager to embrace negative news. Since that time, however, optimism toward economic growth, earnings growth and stock market prospects have become the main investment themes. The most recent example of this trend is the incredibly positive reaction to last month’s tax bill, which has caused investors and analysts to forecast increasingly higher earnings results even as valuations are growing less attractive. Such an environment causes us to take pause and examine the risks. Earnings expectations are quite high. While we think they can still be met, the higher expectations rise, the harder it will be for results to beat estimates. Read a summary of insights from Nuveen Asset Management's Senior Portfolio Manager and Chief Equity Strategist Bob Doll below, or download the entire investment commentary as a PDF. [+] Read More

Nuveen Reviews 2017 Predictions and Looks Ahead to 2018

December 21, 2017
As the year draws to a close, it appears more of our predictions are correct than not... We have been describing 2017 as a “Year of Transition." We expected improving economic growth, accelerating corporate earnings and rising interest rates. We also predicted rising volatility amid equity market leadership changes. Depending on movements of a few basis points for the 10-year Treasury yield, we are likely to get either 7 or 7½ of our 10 predictions correct. Read an excerpt of Nuveen's 2017's predictions in review, or download the entire investment commentary as a PDF. [+] Read More

Nuveen Looks Ahead to Future of the Bull Market, Tax Reform in 2018

November 16, 2017
The bull market in equities is aging but remains very much intact... For more than a year now, equity markets have enjoyed an unusual combination of low volatility and near-uninterrupted price gains due to a combination of accelerating economic growth, improving earnings, accommodative monetary policy and still-low inflation. Economic growth should continue to improve, but expectations have risen, which means positive surprises will be harder to come by. At the same time, central bank policy is slowly tightening, which could contribute to market volatility. Additionally, accelerating growth and tighter policy may finally trigger an uptick in inflation, especially in wage inflation given the low level of unemployment. Should this occur, we expect bond yields will climb, which could jolt other financial assets including equity markets. We don’t expect yields to rise unimpeded, but an ascending period of peaks and troughs looks likely. Read an excerpt of the complete commentary below, then download the entire investment commentary as a PDF. [+] Read More

Nuveen Asks What Matters and What Doesn’t for Equities?

October 26, 2017
Investors remain calm as equity prices move higher against a backdrop of very low volatility... Investor attention remained focused on Washington, D.C. last week. The Senate passed a budget resolution, while President Trump is set to announce who he will select as the next head of the Federal Reserve. These factors, combined with ongoing solid economic data, allowed the so-called reflation trade to continue as higher-risk financial assets gained ground. U.S. equities notched their sixth consecutive week of gains... Read an excerpt of the complete commentary below, or download the entire investment commentary as a PDF. [+] Read More

Nuveen Expresses Confidence in Bull Market

September 21, 2017
Despite Roadblocks, Expect the Bull Market to Continue... Following a down week for stocks, investors adopted a risk-on approach, moving back into equities. While the damage from Hurricane Irma was devastating in terms of human costs, the economic impact was less severe than feared. The S&P 500 Index rose 1.6% last week and all major U.S. indices reached new highs. As part of the broader outperformance trend among risk assets, Treasuries were weaker across the yield curve last week, the dollar rose slightly, gold prices fell and oil moved higher. Read an excerpt of the complete commentary below, or download the complete commentary as a PDF. [+] Read More

Nuveen Estimates Hurricane Harvey’s Impact, Risks Ahead

September 7, 2017
We advocate sticking with a pro-growth investment stance... The devastation caused by Hurricane Harvey dominated the news last week. From an economic perspective, damage to the region’s energy infrastructure is likely to cause local disruptions and contribute to a temporary increase in gasoline prices. But we expect the broader economic and market effect to be limited. Equity prices rose for a second straight week, with the S&P 500 Index up 1.4%. Health care, technology and industrials led the way, while financials and bond proxies such as telecommunications and utilities fared the worst. Read an excerpt of the complete commentary below, or download the complete commentary as a PDF. [+] Read More

Nuveen Weighs Effect of Political Uncertainty on Stocks

August 24, 2017
Escalating Political Uncertainty Drags on Stocks As last week began, attention was focused on attempts to dial back tensions between the United States and North Korea. As the week progressed, investor focus turned to the backlash over President Trump’s comments in the wake of the violence in Charlottesville. Despite good economic and earnings news, the negatives won out and stock prices fell for a second week, with the S&P 500 Index dropping -0.6%. Global financial markets are enduring a bumpy phase, largely due to rising geopolitical tensions and domestic political uncertainty. While the damage to equity markets and other risk assets has so far been minor, investors are focusing on potential downside risks that could trigger additional damage. Read an excerpt of the complete commentary below, or download the entire investment commentary as a PDF. [+] Read More

Nuveen Evaluates Economic Growth, Recession Risk

August 10, 2017
Risks Appear Tilted to the Upside for Stocks Although economic data was positive and earnings continued to be strong, U.S. equities were mixed last week. Markets appear to be in a holding pattern, with investors waiting for more news on Federal Reserve balance sheet normalization and tax policy. For several months, volatility has remained low while equity prices have grinded unevenly higher. This has prompted many investors to look for signposts that could cause a change in direction. Possible dangers could include the end of emergency zero-interest-rate policies, high global debt levels, slow productivity growth or political instability caused by such issues as widening income inequality or rising protectionism. Read an excerpt of the complete commentary below, or download the entire investment commentary as a PDF. [+] Read More