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Washington DC, North Korea Have Skew at Multi-Year Highs

By John Swarr | August 31, 2017

Despite the S&P500 (SPX) being less than 2% off the all-time high it achieved a mere three weeks ago, market signals are suggesting that investors are beginning to turn bearish on equities. Turbulence within the Trump administration, the potential for a government shutdown, and tension with North Korea all have investors nervous as volatility starts to pick up after a historically low period the past several months. As a sign market participants are wary of a pullback in equities, traditional safe-haven assets such as gold and the Japanese Yen have been rallying since mid-July.

Geopolitical Risks Muddy the Economic Picture

By David O'Malley | August 14, 2017

Geopolitical risks dominated headlines last week with the increasing escalation over North Korea’s nuclear weapons program stealing most of the spotlight. The war of words that has been simmering between the U.S. and North Korea bubbled over into markets. After making new highs, the S&P 500 fell 2% late in the week, marking the first significant sell off in several months.

S&P 500 Fails to Break 2400 – For Now

By David O'Malley | May 15, 2017

The S&P 500 failed to break the 2400 level last week but did set an all-time closing high of 2399.63 on Wednesday, May 10. The market continues to drive higher, led by technology stocks and decent first quarter earnings. I expect stocks to continue to grind higher for the next several weeks.

Market Breadth Deteriorating, Inflation Pressure Building

By Zhiwei Ren | October 20, 2016

A New York Times article about how Walmart is getting better results by paying employees more recently caught my attention. Walmart has 1.4 million employees in U.S., and this strategy change will have ripple effects on labor market. In the past few months, we have seen several signs that some long-term trends are changing

Does the August Employment Report Determine Fed Rate Increase in September?

By David O'Malley | August 29, 2016

Last week’s Jackson Hole meeting reinforced the consensus view within the Federal Reserve (Fed) that the U.S. economy is continuing to improve and that the Fed expects to achieve its dual mandate of full employment and stable inflation in the coming quarters.

Is There Alpha in Private Assets?

By Trevor M. Williams | July 7, 2016

While the market volatility-buffering benefits of private equity are well known, advocates of the investment vehicle have also long argued that private equity-backed companies tend to perform better than their publicly-traded counterparts.

What the Brexit Vote Means to U.S. Investors

By John Swarr | June 23, 2016

The European Union (EU) referendum vote tonight has created a series of unknowns for investors. The first unknown is whether or not the U.K. remains in the EU. Should the U.K. vote to leave the EU, investors will face a second set of unknowns.

Gold and Cyclical Inflationary Pressure

By Zhiwei Ren | April 21, 2016

The correlation between gold and the S&P 500 Index tends to be negative in a crisis, but, during a bull market, it averages a correlation around 0.4. This low/negative correlation helps to demonstrate the diversification benefits of gold. But low correlation is not the only reason to buy gold.

Is Inflation Good for Equities?

By David O'Malley | February 22, 2016

Inflation data still remains low and energy is holding down the headline CPI numbers, but, given the recent uptick in average hourly earnings, it is worth watching any trend for inflation closely. Is rising inflation good for equities?

Is Something Fundamentally Wrong Beneath the Surface of the Markets?

By David O'Malley | February 8, 2016

The tone of the market last week was very concerning to me. The momentum darlings of 2015 are now starting to lead the declines in 2016. Even more concerning than the current equity volatility is what is happening in the fixed income credit markets.



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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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