Market volatility shouldn’t derail retirement goals
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Markets and Economy
Nationwide’s Chief of Investment Research and the Nationwide Economics team offer daily and weekly commentary and analysis of the equity and bond markets, including an overview of economic data being released, global market news, commodities and market performance by index returns. These timely insights can help you navigate markets and understand emerging trends.
Podcast: Job and wage growth stronger than expected
November’s jobs report showed surprisingly strong hiring and faster growth in average hourly earnings — suggesting little easing of labor market conditions. What does this tell us about the overall economy? How could this affect the Fed's decision to continue with their aggressive rate hikes? Nationwide's economists Bryan Jordan and Ben Ayers discuss the recent jobs report and what it tells us about the direction of our economy.
Market Bounces from Universal Pessimism
Stocks and bonds remain positively correlated, with bonds experiencing an impressive rally as the Bloomberg US Aggregate Bond Index has gained in seven of the past nine weeks. The yield on the 10-year Treasury has dropped 0.75% to 3.50% on hopes for a Fed pivot following a speech by Chair Powell that said, “it makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down.”
Continued growth even as clouds build over the outlook for 2023
Consumer trends remained solid into the fourth quarter, supported by strong job and wage growth. But many businesses are anticipating lower sales and production ahead, which should reduce hiring over the next year — weakening the tailwinds for consumer activity. Interest rates should also move higher with the Fed warning that it might implement more tightening than previously estimated in 2023 to bring inflation back to trend, adding to worries that restrictive monetary policy will soon push the economy into a recession.
A retail conundrum: strong spending defies weak earnings
Consumers appear committed to spending, but some retailers are faring better than others.
Markets continue higher, though protests in China threaten to derail the recovery
The technology sector continues to struggle, led by Apple and several chip companies that will be disrupted by the protests. For the year, the Russell 1000 Value Index is down just 6%, while the Russell 1000 Growth Index is down 25%, though the valuation for the value index remains at a substantial discount to growth (14x vs. 23x). Small caps are also doing well relative to large-cap growth, with the S&P Small Cap 600 Index down 12% with a forward valuation of 13x.
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