I hope everyone had a great weekend! It’s officially Super Bowl week with the Seahawks taking on the Patriots. Who are you picking? Side note – Phil (the groundhog) saw his shadow, predicting six more weeks of winter. Don’t shoot the messenger.
Markets opened mixed this morning coming off a dramatic week for the metals trade that saw both gold and silver tumble from recent highs. Much of the volatility stemmed from the somewhat surprising nomination of Kevin Warsh as Fed Chairman by President Trump. Warsh is viewed as more of a hawk when it comes to monetary policy with many seeing this as a contradiction to the President’s desire for lower rates. I feel Warsh brings reassurance of Fed independence and will end up being more dovish than many feel. Time will ultimately tell but for now, earnings have been solid (not without surprises) with growth of ~15% year over year. It will be another busy week with some 129 S&P 500 companies set to report over the coming days. I am most looking forward to the January jobs report set to be released this Friday. The consensus is for the unemployment rate to remain unchanged at 4.4% though any divergence will likely influence interest rate projections going forward. All things considered, I remain anchored in my view that this market will continue to broaden out and favor more value concentration within stocks. Please continue to reach out with any questions/comments.
Attached, please find this week’s Market Strategy Radar Screen Report from John Stoltzfus, Chief Investment Strategist of Oppenheimer Asset Management.
Have a great week!