Valley Peak Newsletter: June 12th
Looking Back: As we navigate the second week of June, the markets have shown resilience in the face of broader economic uncertainties. Let's delve into the key developments and what they might mean for our balanced investment approach.
Equities: Last week, global equities presented a mixed bag. The S&P 500 inched up by 0.3%, buoyed by solid earnings announcements from major tech companies. European indices faced downward pressure amid concerns over economic growth and inflation. Asian markets dipped slightly, influenced by underwhelming economic data from China and regulatory concerns in the tech sector. In a balanced portfolio, this volatility underscores the importance of diversification across sectors and geographies.
Bonds: The bond market reflected slight moves in yields. The U.S. 10-year Treasury yield edged up to 3.75%, influenced by speculations around the Federal Reserve's future rate hikes. In Europe, while the German Bund yield rose to 2.25% and the Bank of England's kept rates steady at 4.5%, the European Central Bank decided to cut interest rates after a campaign of rate hikes to fight inflation. For risk-averse investors, maintaining a portion of the portfolio in high-quality bonds continues to be a prudent strategy.
Commodities: Oil prices rose 2.5% to $79 per barrel, supported by OPEC+ production cuts and geopolitical tensions. Gold remained relatively stable at $1,960 per ounce, balancing safe-haven demand against a stronger dollar. Agricultural commodities faced downward pressure due to favorable weather conditions. These movements emphasize the value of commodities as a hedge against market volatility and inflation.
Economic Data: Various data points painted a mixed picture of the global economy. In the U.S., the May jobs report exceeded expectations with a 340,000 increase in non-farm payrolls, highlighting labor market strength. However, the benchmark manufacturing index fell, signaling a potential coming contraction. In the Eurozone, inflation remained high at 6.1% year-over-year, sparking discussions on contrasting monetary policy as the ECB lowers interest rates.
Looking Forward: In summary, the past week has highlighted the complex interplay of economic data, central bank actions, and geopolitical events in shaping market dynamics. A balanced approach to investing remains essential to hedge losses and mitigate risks in these uncertain times.
Disclosures:
Past performance is no guarantee of future success. This material is for informational use only and should not be considered investment advice.
The opinions expressed are those of Guardian Wealth Advisors, LLC. The opinions referenced are as of the date of publication and are subject to change due to changes in the market or economic conditions and may not necessarily come to pass. Forward looking statements cannot be guaranteed. Investing involves risk. Principal loss is possible.
Investment advisory services offered though Guardian Wealth Advisors, LLC D/B/A Valley Peak Financial. Guardian Wealth Advisors, LLC ("GWA") is an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. More information about GWA's investment advisory services can be found in its Form ADV Part 2, which is available upon request. GWA-24-45
