Broker Check

Mosaic Asset Partners - Are We Back On A Roll Again

May 10, 2024

HAPPY MOTHERS DAY!

I want to wish all of the mothers out there a very happy, relaxing and stress-free Mother’s Day. There is no question that this world would not operate without you!

As I write this weekly update, the Dow is currently riding a seven-day winning streak (will it be 8?) and pushing past a lot of the negative sentiment that has been pervasive as of late. Investors seem to be a bit more optimistic lately after the Federal Reserve indicated the next move is unlikely to be a hike. A proverbial “cap” on interest rates could be bullish for equities in the near-term as evidenced this week. A strong earnings season, as well as some softer labor data, have also bolstered confidence in the stock market outlook. “What’s important in all of this context is, ‘are we in the early stages of a long-term bull market or not?’” said Chris Hyzy, chief investment officer of Merrill and Bank of America Private Bank. “It feels comfortable saying it on a day like this, but we are, in our opinion.” Keep in mind this is only one statement, from one investment strategist, but the great divide on where we stand today is truly mixed and unsure.

From our vantage point, the data we are seeing is lagging by nature and I do believe the slowing trend is settling in. I can hear it in the voices of our clients, and I see it firsthand daily. Just to be clear, slowing down is okay and expected in my opinion. It’s the nature of the cycle we are in right now. Lingering, high inflation has a longer-term impact while an extended and inverted yield curve can cause inflation frustration. These vital economic components matter in the short and longer term as to the direction of things to come. The Fed has a pivotal role in this as the “person” controlling the throttle. The economic merry-go-round may slow down for some to jump off, while others hop on, but it typically doesn’t come to a complete stop. This is where we have to rely and hope the Fed can get it right. They are truly the amusement ride operator. Let’s hope the safe and fun ride continues.

The only real piece of economic news that came out this week was the weekly jobless claims.  Jobless claims totaled a seasonally adjusted 231,000 for the week ending on May 4, up 22,000 from the week before. This was the highest claims number since late August 2023. It seems the slowing trend is continuing. Another interesting thing to note from a personal perspective is the lower level of summer jobs available to high school and college students. We have also been hearing that many college graduates are also experiencing a more challenging job market. Again, for the reasons we have mentioned previously, employers are certainly being more cautious and taking a wait and see approach. With the rapid emergence of AI and a slowing down economic engine, the need to preserve capital and watch expenditures is paramount right now. Like everything in life, these things also will move in cycles. This too shall pass as things settle down. It’s the waiting and timing that can be the biggest frustration. We are in this together for the long-haul.

Have a nice weekend!

https://www.cnbc.com/2024/05/09/weekly-jobless-claims-jump-to-231000-the-highest-since-august.html?__source=iosappshare%7Ccom.apple.UIKit.activity.Mail
https://www.cnbc.com/2024/05/09/stock-market-today-live-updates.html?__source=iosappshare%7Ccom.apple.UIKit.activity.Mail

Christopher E. Wasson, CFP®

President

Mosaic Asset Partners, LLC

1122 Kenilworth Drive, Suite 310

Towson, MD  21204

410.821.0089         fax 410.821.5993

MosaicAssetPartners.com  

Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Mosaic Asset Partners, LLC is not affiliated with Kestra IS or Kestra AS.  Investor Disclosures: https://www.kestrafinancial.com/disclosures

The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security.