Latest news with #MichaelKantrowitz
Yahoo
4 days ago
- Business
- Yahoo
Making sense of the whiplash in investor sentiment
Tariffs, earnings, and policy confusion have put investors on a roller coaster of emotions. In the video above, Yahoo Finance Anchor Julie Hyman takes a closer look at what Piper Sandler chief investment strategist Michael Kantrowitz calls "narrative volatility." To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here. Whiplash is what you and I might call it, but Michael Kantrowitz of Piper Sandler calls it narrative volatility. He and his team have been looking at what they say are really abrupt and dramatic shifts in sentiment over time. They're doing this by measuring AAII bearish sentiment, the American Association of Individual Investors, in other words, it's a measure of newsletters and where that sentiment is blowing. So what this chart looks at is the weekly sentiment indicators that come out in the sort of blue background here, and then the standard deviation from those newsletter writers on a weekly basis, and that's a four-year rolling window. So basically, this is a way of measuring, again, what Kantrowitz calls that narrative volatility. We've looked at other times when we've seen big changes in the narrative quickly, the great moderation here in the early 90s, the tech bubble popping, when you saw low narrative volatility, then back up, and down again during COVID. But now, according to this measure, at least, they say we're at the highest narrative volatility ever. In other words, tariffs on, tariffs off, things are good, things are bad, the economic outlook is strong, no, it's not. Um, and as to what to do about it? Well, we talked to Kantrowitz earlier on about that. This is what he said. The lighter line of bearish sentiment is extremely volatile and catching the wave, you know, good luck. Anyone who could catch that wave, uh, more likely to be, uh, uh, hit by the wave than catching it. So it's not really realistic to catch these short-term risk on risk off swings in the market, and we think they will persist. So this is the norm for now, the back and forth. He talked about what has been his consistent strategy, which is to get into what he calls quality stocks here, stocks with strong balance sheets, good cash flow. Um, so we'll see if that strategy continues and also if that narrative volatility sticks around, Josh. All right. Thank you, Julie. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
4 days ago
- Business
- Yahoo
Making sense of the whiplash in investor sentiment
Tariffs, earnings, and policy confusion have put investors on a roller coaster of emotions. In the video above, Yahoo Finance Anchor Julie Hyman takes a closer look at what Piper Sandler chief investment strategist Michael Kantrowitz calls "narrative volatility." To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
24-05-2025
- Business
- Yahoo
The stock picker's market is back: Chart of the Week
After about a month of tariff headlines pushing the market both up and down in unison, the market mood took a turn in May. When President Trump announced his first reciprocal tariff pause, the rolling one-month correlation of stocks within the S&P 500 (^GSPC) peaked at nearly 0.7 as the rising tide lifted nearly all boats. This was rare: Going back over the past five years, the only other times such a high correlation has been seen were in 2022 when the Federal Reserve began hiking interest rates and during the initial market reaction to the onset of the pandemic in 2020. By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy For investors, these market moments all have a familiar feeling. They were macro moments, the kind of time period in which what's happening to each company on an individual basis can suddenly become insignificant if a headline from the administration changes the overall market story. But as our Chart of the Week shows, those headlines have increasingly ceded territory back to the individual stock stories themselves. The rolling one-month S&P 500 correlation is now hovering below 0.3. This, according to Piper Sandler chief investment strategist Michael Kantrowitz, has brought the market back to the micro, creating the kind of market where certain stocks could outperform because they're less exposed to tariffs than others. Or perhaps they're economically cyclical names that could benefit should the economic data fail to turn as dour as some surveys warn. To use the common term often cited by Wall Street strategists, it appears we may once again be entering a "stock picker's market." "We are transitioning to a backdrop with mixed data and mixed views," Kantrowitz wrote in a note to clients on May 21. "This should keep market correlations low, as stocks should trade more with micro fundamentals and not entirely on macro headlines like we saw earlier this year." He added that"many of the macro fears that remain are more likely to be issues that differentiate stocks rather than dominate all of them," leaving investors with their work cut out for them. To be clear, most strategists, including Kantrowitz, have been quick to point out that this doesn't mean there's been an all clear for a further full risk-on rally in the markets. There is still a looming drop-off in economic data that many expect. And the tariff pauses are still just that: pauses. With Friday's stock slide after Trump threatened further tariffs on the European Union and Apple, investors got a sharp reminder that the trade war back-and-forth isn't over. Still, as Morgan Stanley chief investment officer Mike Wilson wrote in his mid-year outlook sent to clients on Thursday, the focus now for investors is on "the rate of change" in policy expectations, economic data, and company earnings. As Trump's most recent threat to escalate tariffs again showed Friday, abrupt changes in those rates of change remain in play. Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer. Click here for in-depth analysis of the latest stock market news and events moving stock prices Sign in to access your portfolio
CNBC
23-05-2025
- Business
- CNBC
Interest rates will remain sticky for some time, says Piper Sandler's Michael Kantrowitz
Michael Kantrowitz, Piper Sandler chief investment strategist, joins 'Power Lunch' to discuss how investors should position, what to expect from the bond market, and much more.
The Star
21-05-2025
- Business
- The Star
U.S. stocks close lower amid rising Treasury yields
NEW YORK, May 21 (Xinhua) -- U.S. stocks ended lower on Wednesday as 20-year bond auction saw weak demand, and U.S. Treasury yields surged. The Dow Jones Industrial Average dropped 816.80 points, or 1.91 percent, to 41,860.44. The S&P 500 fell 95.85 points, or 1.61 percent, to close at 5,844.61, while the Nasdaq Composite lost 270.07 points, or 1.41 percent, ending at 18,872.64, its first negative day in three. Ten of the eleven major S&P 500 sectors closed in negative territory. Real estate and health care led the declines, falling 2.63 percent and 2.37 percent, respectively. Communication services was the only sector to post a gain, rising 0.67 percent. The downturn came as U.S. Treasury yields climbed, with the 10-year yield nearing 4.6 percent and the 30-year yield rising above 5 percent. Yields spiked further after the U.S. government's 16-billion-U.S.-dollar auction of 20-year bonds received weaker-than-expected demand, resulting in a higher yield than markets had anticipated. In a client note published Wednesday, Piper Sandler's chief investment strategist Michael Kantrowitz outlined important thresholds for the 10-Year Treasury yield and explained how movements around those levels could affect the stock market. "The path of rates will also be crucial for equities, particularly for relative performance," Kantrowitz wrote. "Since 2022, equity markets have struggled when 10 yr rates moved above 4.5-4.75 percent and we are pushing up against that zone once again." Meanwhile, investors kept a close eye on developments in Washington, D.C., where debate continues over U.S. President Donald Trump's tax-and-spending bill. The proposed legislation would extend existing tax cuts and introduce new ones, but is projected to add roughly 3 trillion U.S. dollars to the federal deficit over the next decade. "The question now is, from a fiscal perspective, what will the tax bill look like, and will it undo all of the recent fiscal frugality by simply raising the debt level at a slower rate of pace? So I think that's why the 10-year yield is moving higher -- because investors are worried that we're really not doing anything to slow the pace of inflation and to reduce the debt," Sam Stovall, CFRA Research chief investment strategist, told CNBC in an interview. The bond-driven pressure on equities was compounded by disappointing earnings reports from major retailers. Target dropped 5.21 percent after slashing its annual forecast, citing reduced consumer spending and lower confidence. Lowe's lost 1.68 percent after reaffirming its guidance, and TJX fell 2.89 percent after maintaining its outlook, assuming tariffs with China remain unchanged.
