Resources

Economic trends generally improved in November, even after strong gross domestic product (GDP) growth over the last two quarters.

We view last week’s market decline as a retest of the October–November lows.

Conflicting messages from government officials led investors to question initial trade-deal optimism.

We reflect on the 2018 markets and provide our expectations for 2019.

Fed fund futures are more dovish than the Fed’s dots, but the Fed is treading carefully.

Last week’s stock market rally was driven by optimism (now clearly warranted) surrounding U.S.-China trade talks and a more dovish Fed.

We expect robust capex growth to resume once U.S. businesses get more clarity around trade.

Third quarter earnings season was again very impressive, with S&P 500 Index earnings growing 28% year over year, the fastest pace since the fourth quarter of 2010.

Upgraded our view of mortgage-backed securities (MBS) from neutral to neutral/positive; Downgraded our view of bank loans to neutral from neutral/positive.

We still believe trade’s economic impact will be limited, but the indirect consequences should be monitored.