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Jackson Hole Conference will be Closely Watched

By David O'Malley | August 21, 2017

Beginning on Thursday, the Kansas City Federal Reserve Bank hosts its annual conference in Jackson Hole, Wyoming. The annual meeting draws central bankers from around the world, including Janet Yellen from the U.S. Federal Reserve (Fed) and Mario Draghi from the European Central Bank (ECB).

U.S. Corporate Bonds Are Losing Their Appeal to Overseas Investors

By James Faunce | July 27, 2017

For the last several years, we have noted the extremely strong technical backdrop supporting investment grade (IG) corporate credit spreads. With the global rate environment extraordinarily depressed from prolonged accommodative central bank policies around the world, investors have diligently been seeking yield. In fact, with the 2016 launch of the European Central Bank’s (ECB) Corporate Sector Purchase Program (CSPP) for eligible euro-denominated corporate debt, the universe of corporate credit opportunities has become even smaller, keeping spreads very firm globally.

Earnings Heat Up This Week

By David O'Malley | July 17, 2017

Second quarter earnings will receive significant attention this week, as stocks pushed to new highs on the S&P 500 Index last week. Expectations for solid earnings reports have been growing over the past few weeks and are necessary to keep stocks grinding higher.

Foreign Demand Driving Credit Spreads Tighter

By Mark Heppenstall | March 23, 2017

Despite recent signs of accelerating growth and inflation in the global economy, central bank monetary policy remains very accommodative. Short-term rates are stuck near or below the zero-level across most of the developed world, and more than $8 trillion in sovereign debt still trades with negative yields. Even BB-rated Portugal can issue 2-year bonds at just over 50 basis points (bps) today, less than half the rate paid by 2-year on U.S. Treasury notes.

Stay Defensive on Asset Valuations Due to Uncertainty

By David O'Malley | October 17, 2016

Both stocks and bonds lost ground last week as significant uncertainty remains ever present in market dialog. The week ahead holds more potentially negative headlines for asset prices.

Structural Reform, Not More Monetary Policy, Needed for Stronger Nominal Growth

By David O'Malley | August 1, 2016

Last week the Federal Reserve (Fed) decided to keep short-term interest rates unchanged. The decision was widely expected by market participants, and many now expect the Fed to keep interest rates unchanged well into 2017.

Central Banks to the Rescue Again

By David O'Malley | July 5, 2016

Last week started with risk markets around the globe continuing the plunge that began with the Brexit vote. However, as central banks around the globe indicated they stood ready to combat any negative impacts from Brexit, risk markets rallied and ended the week higher.

Global Central Bank Policies Pushing the Limits of Return-Free Risk

By Mark Heppenstall | June 17, 2016

The opportunity to earn return-free risk was taken to new heights last week with Toyota Finance Corporation’s issuance of 3-year Yen-denominated bonds yielding 0.001%.

All Eyes on the Central Banks This Week

By David O'Malley | April 25, 2016

Markets across the globe will be focused on the European Central Bank (ECB), Bank of Japan (BOJ) and the Federal Reserve (Fed) this week. With sluggish global growth and negative interest rates on the top of economist’s minds, this week’s announcements will be closely scrutinized.

ECB Cuts Rates; Expect the Fed to Hold Rates This Week

By David O'Malley | March 14, 2016

Last week, the European Central Bank (ECB) increased monetary stimulus. The continued stimulus was widely expected, but the amount exceeded expectations. The Fed meets this week, and I don’t expect them to increase interest rates until June at the earliest.



Disclosure Statement

This blog post is for informational use only. The views expressed are those of the author, Dave O’Malley, and do not necessarily reflect the views of Penn Mutual Asset Management. This material is not intended to be relied upon as a forecast, research or investment advice, and it is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy.

Any statements about financial and company performance of The Penn Mutual Life Insurance Company or its insurance subsidiaries (each, “Client”) made by the author is provided with a written consent from the Client.  Penn Mutual Asset Management is a wholly owned subsidiary of The Penn Mutual Life Insurance Company.

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Opinions and statements of financial market trends that are based on current market conditions constitute judgment of the author and are subject to change without notice.  The information and opinions contained in this material are derived from sources deemed to be reliable but should not be assumed to be accurate or complete.  Statements that reflect projections or expectations of future financial or economic performance of the markets may be considered forward-looking statements.  Actual results may differ significantly.  Any forecasts contained in this material are based on various estimates and assumptions, and there can be no assurance that such estimates or assumptions will prove accurate.

Investing involves risk, including possible loss of principal.  Past performance is no guarantee of future results.  All information referenced in preparation of this material has been obtained from sources believed to be reliable, but accuracy and completeness are not guaranteed. There is no representation or warranty as to the accuracy of the information and Penn Mutual Asset Management shall have no liability for decisions based upon such information.

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