Category: Markets

Cut to the Chase: The Reality of Rate Cuts

(Note: companies that could be impacted by the content of this article are listed at the base of the story (desktop version). This article uses third-party references to provide a bullish, bearish and balanced point of view; sources listed in the “Balanced” section)

The Federal Reserve cut its benchmark lending rate by a quarter point at the end of the Federal Open Market Committee meeting on Wednesday, which is the second rate cut in the last decade, following their last quarter-point cut on July 31 this year. Investors may now be searching for clues about the Fed’s future plans given Wednesday’s announcements.

Can Smallcap Funds Help Cap Index Overlap in Your Portfolio?

(Note: companies that could be impacted by the content of this article are listed at the base of the story (desktop version). This article uses third-party references to provide a bullish, bearish and balanced point of view; sources listed in the “Balanced” section)

Fund Overlap arises when an investor owns two or more mutual funds that invest in similar parts of the market. Indexes will normally hold a high percentage of the top-performing companies in their particular sector, so by holding two similar funds, an investor is bound to have some sort of overlap. This overlap reduces the benefit of diversification and increases your exposures. The simplest way to detect and avoid overlap is to look at your investment categories and consistently check, as funds may deviate from their original style.

Mortgage Rates Jump

MCLEAN, Va., Sept. 19, 2019 (GLOBE NEWSWIRE) — Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey^® (PMMS^®), showing that the 30-year fixed-rate mortgage (FRM) rate averaged 3.73 percent. This week’s 30-year fixed mortgage rate increase is the largest week-to-week uptick since October 2018.

Sam Khater, Freddie Mac’s Chief Economist says, “Despite the rise in mortgage rates, economic data improved this week – particularly housing activity, which gained momentum with a noticeable rise in purchase demand and new construction. Homebuyers flocked to lenders with purchase applications, which were up fifteen percent from a year ago and residential construction permits increased twelve percent from a year ago to 1.4 million, the highest level in twelve years. While there was initially a slow response to the overall lower mortgage rate environment this year, it is clear that the housing market is finally improving due to the strong labor market and low mortgage rates.”

News Facts

• 30-year fixed-rate mortgage averaged 3.73 percent with an average 0.5 point for the week ending September 19, 2019, up from last week when it averaged 3.56 percent. A year ago at this time, the 30-year FRM averaged 4.65 percent. 
• 15-year fixed-rate mortgage averaged 3.21 percent with an average 0.5 point, up from last week when it averaged 3.09 percent. A year ago at this time, the 15-year FRM averaged 4.11 percent. 
• 5-year Treasury-indexed hybrid adjustable-rate
  mortgage (ARM) averaged 3.49 percent with an average 0.4 point, up from last week when it averaged 3.36 percent. A year ago at this time, the 5-year ARM averaged 3.92 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following link for the Definitions. Borrowers may still pay closing costs which are not included in the survey.

Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we’ve made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders, investors and taxpayers. Learn more at FreddieMac.com, Twitter 
@FreddieMac and Freddie Mac’s blog FreddieMac.com/blog.

MEDIA CONTACT: 
Angela Waugaman
703-714-4829
Angela_Waugaman@FreddieMac.com

Investing in Cannabis: Should You Go Green?

In 2012, Colorado and Washington were the first states to approve the recreational use of marijuana. Since then, cannabis has been legalized recreationally in eleven states and medically in thirty. About a year ago, Canada became the largest country to legalize cannabis completely. Colorado has now generated more than $1 billion in state revenue since 2014, with almost $7 billion in total sales.

Attack on Saudi Refinery: What Does it Mean for You, the Investor?

An oil processing facility at Abqaiq was attacked by drones on Saturday, knocking out 5.7 million barrels/day of oil production. Brent crude futures rose 19.5% to $71.95 per barrel before declining on the news that the refinery will be repaired faster than initially anticipated. The Energy Select Sector SPDR Fund (XLE: NYSE) jumped 3.5% on the open Monday morning. Is now a good time to invest in energy stocks or has the market overreacted to temporary events?

Kelly Education Appoints New Education Sales Leader

Rick Lenkey joins
education talent provider that helps schools counter the teacher shortage

TROY, Mich., Sept. 17, 2019 (GLOBE NEWSWIRE) — Kelly Education, the nation’s first and largest educational talent provider, today announced that Rick Lenkey joined the company as vice president of education practice sales. In this role, Lenkey will lead the national sales organization in addressing the teacher shortage through quality workforce solutions. He brings extensive experience in education through his more than 20 years at McGraw-Hill Education, where he most recently served as vice president, national sales manager.

“We’re thrilled to welcome Rick and his dedication to partnering with educators to enrich student lives through education,” said Kelly Education Vice President and Managing Director Nicola Soares. “Each day, the teacher shortage continues to grow, impacting classrooms across the country. Rick’s leadership and expertise will enhance our ability to reach more school districts with our talent solutions that not only help counter the teacher shortage, but also support student achievement.”

“I’m excited to continue my career in education and particularly honored to be doing so with Kelly Education,” said Lenkey. “I’m looking forward to partnering with our schools to provide quality teaching staff in every classroom and more.”

About Kelly Education
At Kelly Education, we believe that education is a shared responsibility—and we’re dedicated to bringing the best educators to your classrooms. Operating as a specialty service of Kelly^®, a global workforce solutions provider that’s always asking what’s next in the world of work, we’re proud to be the first comprehensive education talent management solution developed by a staffing company. Launched in 1997, Kelly Education partners with more than 7,000 public, private, and charter schools across 38 states. In addition, Kelly Education provides schools with quality substitute teacher staffing and management, as well as after-school program staffing, and the staffing of non-instructional positions such as custodians, cafeteria employees, administrative assistants, and school nurses. More than three million classrooms are filled by a Kelly Education substitute teacher each school year.

Media Contact:

Anna Schryver

Kelly Education

Senior Public Relations Manager

W: 248.469.0522 M: 608.225.5476

anna.schryver@kellyservices.com 

News Provided by GlobeNewswire via QuoteMedia

Will the Market Surpass All-Time Highs?

At the start of 2019, the stock market saw one of its strongest first halves on record. The S&P 500 rose more than 17%, making it the best start of the year for the index since 1997. The markets have continued to rise in the 3^rd quarter, even with trade tensions accelerating and the thought of a recession looming. According to the latest ABC News poll, 60% of Americans think a recession is coming in the next 12 months, resulting from declining global economies. Although many believe we will enter into an economic contraction, economists are confident the market will continue to hold out.

Are Nanocap Stocks a Beneficial Addition to Your Portfolio?

Market capitalization refers to the total dollar market value of a publicly traded company. It is one of the best measures of a company’s size and is calculated by multiplying the number of shares outstanding by the current stock price per share. Market caps can change day to day when stock prices fluctuate, but they are typically classified as nano, micro, small, mid, large or megacap categories. For an entity to be placed in the nanocap segment, it must have a market cap of less than $50 million.

Utility Stocks May Offer Low-Risk Investment Potential

Utility companies and their respective stocks can provide investors with a low-risk investment and unique advantage. Income investors can purchase smallcap utility company stocks, which are often undervalued and can provide long-term gains. Utility stocks tend to be lower risk and, much like conservative investments such as bonds, allow investors to take advantage of their higher dividend payouts.

Worth the Risk? An Overview of Investing
in Small & Microcap Stocks.

The mention of investing in small & microcap stocks may initially raise some red flags. However, one must remember that any investment carries a great deal of risk and uncertainty, but the prepared investor will do the research and make a sound decision for their portfolio. A smallcap stock typically has a market cap of $300 million to $2 billion, while a microcap company falls in the $50 million to $300 million range. Although these smaller-scaled companies are viewed as young and volatile, they also bring many potential investment benefits.

Inverted yield curve? So what! What if yields turn negative?

(Note: companies that could be impacted by the content of this article are listed at the base of the story (desktop version). This article uses third-party references to provide a bullish, bearish and balanced point of view; sources listed in the “Balanced” section)

The Dow Jones Industrial fell more than 800 points on August 14
^th when the yield on the 10-year treasury bond fell below that of the 2-year treasury note.  Much has been made about the inversion of the yield curve and how that often signals a recession.  Less has been made about the fact that the government bond yields are now below 2% and appear to be headed lower.  Prominent bond experts such as Mohamed El-Erian and Alan Greenspan say they would not be surprised to see rates go negative.  The reason for the decline is obvious.  Investors are losing confidence in the economy and moving money from the stock market to places of security.  Will this lack of confidence become a self-fulfilling prophesy as decreased investment and spending cause economic weakness (bear case) or is it a mere coincidence (bull case)?

China currency devaluation: Who is this helping?

(Note: companies that could be impacted by the content of this article are listed at the base of the story (desktop version). This article uses third-party references to provide a bullish, bearish and balanced point of view; sources listed in the “Balanced” section)

As President Trump threatens to impose more tariffs on goods from China, the response was China devaluing their currency. For the first time in more than a decade, the yuan is at an all-time low of 7 yuan per dollar. With investors fearing that this will have a heavy impact on global growth, many have got out of their Asian currency investments associated with exports and moving to safer investments, like the Japanese yen. Although this may lead to economic growth for China, it may lead to increased inflation and a currency war worldwide.

Markets see a slight calm: how long will this last?

(Note: companies that could be impacted by the content of this article are listed at the base of the story (desktop version). This article uses third-party references to provide a bullish, bearish and balanced point of view; sources listed in the “Balanced” section)

With the surprise weakening of the yuan on Monday, the market went into shock and investors sought safer investments. Export data from China released on Thursday however, gave investors a slight sense of relief and stocks saw a tentative recovery. The fears of a recession are still up in the air, as the end of the ongoing tensions are unknown.