Monday – October 15, 2018

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Market opened in the red to begin a new week after a completely brutal go last week. It was the worst for stocks since March. Friday brought some reprieve to the harsh selling, which ended the 6-day slide. Investor eyes turn to earnings for a potential rescue for the Bulls. BofA kicked things off with a double-beat. But with the growth rates of both earnings and economic activity likely peaking this year, many on the Street are wondering whether the highs for this Bull cycle are already in. It’s an important debate. Our sense has changed quite a bit over the course of a week. The price action was not healthy mid-week. We have shifted balance back into Fixed Income finding the higher yields attractive. We still think that higher levels are to be had for the S&P 500. But our confidence is not as high as it was in September. We continue to be in risk management mode. Crude is higher to start the new week after big declines last week. WTI is at $72. Gold has been coming back to life, which has certainly provided some cushion for our portfolios. Interest rates are bid higher in early trading but the 10-Year Treasury yield is below the 3.24% multi-year high hit last week. Sears filed for bankruptcy last night. Global Markets were largely lower overnight with Asia feeling the most pain. The US and Saudi’s have built a strong alliance in the Middle East under the Trump administration. The relationship is being tested with the killing of the Saudi journalist in Turkey. This is a very tough stretch for investors. Keep those belts buckled.

Have a great morning,

Mike Frazier

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