– US risk assets declined – equities, real estate, and Treasuries. Intl equities and commodities advanced.
– Value and dividend paying stocks proved a safe haven, moving higher during the week, led by another impressive performance from Energy stocks.
– Strong performance from emerging markets, which moved into positive territory year-to-date.
– Fixed income was down across the board – every sector is in the red for 2022. Lumber prices jumped a whopping 15.8% last week.
– Investor surveys push Psychology out of the worst decile of readings.
– Bond Momentum indicators recommend positioning for wider credit spreads and additional shallowing of the yield curve.
– Keep an eye glued to the equity put/call ratio.
– Global equities rebounded, while Treasuries and Real Estate declined. A 6% increase in Crude oil prices pushed commodity indices higher.
– 2022 has some bright spots. Dividend paying stocks, Pure Value, and the Energy & Financials sectors are all performing well.
– Emerging markets outperformed, as Chinese equities bounced more than 5%.
– No safe haven in fixed income which is down across every key sector. Bank loans are flat.
– Investor psychology improves, but Monetary conditions deteriorate. For now, they are tied at the hip and negatively correlated.
%
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)
