The Exchange Bond Voyage?, High-Flyer, Building on Gains? 12/7/23
Dec 7, 2023
Bond yields predicted to rise and the expectation of Fed rate cuts are discussed. The potential for a rebound in the airline industry and the current state of commercial airplanes is explored. The surge in the Home Construction ETF and its sustainability is questioned. The benefits of lower rates for builders and the rise of Alphabet's Gemini AI are covered.
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Bond Rally Hinges On Data And Fed Messaging
- Steve Leesman highlights rapid repricing in bond markets driven by lower inflation data and faster rate-cut expectations.
- He warns jobs data, large Treasury auctions and Powell could quickly reverse that repricing.
1990s Analogy: Elevated Rates And Stock Winners
- Nancy Tengler likens the current cycle to the 1990s where rates stayed elevated and stocks still rallied.
- She favors owning reliable growers and tech names embracing generative AI and digitization.
Favor Stock Picking Over Broad ETFs
- Jim Bianco recommends stock picking over broad ETFs in a higher-rate world.
- Seek individual names that can overcome competition from attractive cash yields.