– For the third week in a row, all asset classes moved higher. Real Estate was the big winner, up more than 3%.
– The tug of war between growth and value favored growth for the week, as value stocks lagged.
– Peruvian stocks dropped 12.4% after socialist labor leader Pedro Castillo won Peru’s presidency.
– Lumber prices declined a whopping 17.5% last week and is now down more than 37% from the all-time high in May, assuaging some inflation concerns.
– Investor sentiment improvements have proven elusive, and the leading inflation headwind inside the monetary composite could take several months to resolve itself. A correction would improve both.
– All major asset classes advanced for the second week in a row, but it was a big week for inflationary sensitive asset classes like commodities and real estate.
– It was a monster week for Energy stocks – they climbed 6.7%. The Transports took notice, selling off nearly 2%.
– Germany’s stock market has overtaken US equities in ytd performance, as German investors embrace US style FOMO.
– Commodity strength relied on higher oil prices. Copper, lumber, and precious metals all declined.
– No signs of inflation or investor euphoria pressures easing.
%
Market Risk Index scales from 0 to 100%. Higher readings correspond with higher risk markets. Scores below 25% are bullish. Scores between 25-75% are neutral, and scores above 75% are markets vulnerable to major drawdowns.
Model Category Readings (Percentiles)
