Broker Check

Each week the LPL Financial Research team assembles thoughtful insight on market news. 

View All Market Commentaries on LPL.com

PLAYBOOK FOR A FED PIVOT

November 21, 2022
Recent inflation data has tempered expectations for future Federal Reserve tightening, including a potential peak in the terminal rate near 5.0% in May or June of 2023. While the market has welcomed this news, history suggests the path to a Fed pivot could be volatile for stocks due to elevated inflation and interest rate risk...

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INFLATION AND RISING RATES SUPPORTS VALUE

November 14, 2022
In this week’s Weekly Market Commentary we look at the factors driving value’s 2022 outperformance, the technical trading setup for growth and value, and what to look for in the coming months...

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HOW MIDTERM ELECTIONS MAY MOVE MARKETS

November 7, 2022
Historically, there are two key general takeaways from midterms: 1) Markets like them to be over and 2) Markets prefer mixed government...

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FEDERAL RESERVE PREVIEW: TRICK OR TREAT? 

October 31, 2022
With a series of important economic indicators suggesting the economy is declining and inflation is finally decelerating, albeit very slowly, markets are beginning to factor in that the Fed may soon transition to a less aggressive stance in early 2023. 

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THREE THINGS TO KNOW ABOUT RECESSIONS 

October 24, 2022
If the U.S. economy enters a recession, the causes and potential outcome will be hotly debated. At LPL Research, our starting point is always looking at history. 

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LOW BAR FOR EARNINGS SEASON 

October 17, 2022
Expectations are very low for this earnings season. The challenges are many, with intense cost pressures and slowing economic growth at the top of the list...

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POCKETS OF VULNERABILITIES

October 10, 2022
In markets that are focused on what can go wrong when monetary policy moves into restrictive territory, as it is now with global central banks raising interest rates to curtail stubbornly high inflation... 

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MARKETS ON WATCH 

October 3, 2022
Market reforms, trade with the West, and allowing foreign investment led to an economic boom that was characterized by the World Bank as “the fastest sustained expansion by a major economy in history...

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TAKING ADVANTAGE OF HIGHER YIELDS

September 26, 2022
The Fed has signaled that more interest rate hikes will likely be necessary to arrest the generationally high consumer price increases we’re currently experiencing. Markets have already priced in what we think is an appropriate terminal fed funds rate...

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GETTING THE JOBS MARKET BACK INTO BALANCE

September 12, 2022
Federal Reserve Chairman Jay Powell reiterated his warning that getting inflation under control will require some pain. Powell is likely making these warnings based on the arcane, clunky relationship between inflation and unemployment...

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SEPTEMBER'S CALENDAR CRUELTY FOR STOCKS

September 6, 2022
The difficult 2022 for stocks may not get much easier because as we now wait for better news on the inflation front, we have to contend with a seasonally weak month of September. While we got some welcome news in Friday’s jobs report, more evidence of falling inflation will take time to materialize... 

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WHERE WILL HOUSING GO FROM HERE?  

August 22, 2022
Existing home sales fell 5.9% in July, the sixth consecutive month of declines as higher interest rates weigh on housing affordability and prospective buyers. As the housing market slowed, so did prices. The median price for a single family home was $410,600, a decline of roughly $10,000 from June...

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START OF A NEW BULL MARKET?

August 15, 2022
Investors cheered the two better-than-expected inflation reports last week, pushing the S&P 500 to 16% above its June 16 low and only 11% below its all-time high. After this rebound, the key question investors are asking is whether this is a bear market rally that will soon fizzle or the start of a new bull market...

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THE CASE FOR A U.S. RECESSION WEAKENS

August 8, 2022
The market pundits remain intensely focused on the question of whether the U.S. economy is in or about to enter recession, so we thought a piece on what a recession might mean for the stock market would be of interest. While Friday’s strong jobs report provides more evidence that the U.S. economy...

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WHAT A WEEK

August 1, 2022
That was quite a week. These days a Federal Reserve (Fed) policy meeting alone gets a lot of headlines and has market participants on the edge of their seats. Add to that the second straight quarter of negative gross domestic product (GDP) growth that...

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Three Factors That Could Change the Course of Inflation

July 25, 2022
For the past year, supply-related problems contributed more to inflation than demand-related imbalances, but that may be changing soon. There are at least three factors that could change the course of inflation. First, the improvement in...

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Managing Volatility

July 18, 2022
Markets rarely give us clear skies, and there are always threats to watch for on the horizon, but the right preparation, context, and support can help us navigate anything that may lie ahead. So far, this year hasn’t seen a full-blown crisis like 2008–2009 or 2020, but the ride has...

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Constructive, Not Complacent: Lowering S&P 500 Target

July 5, 2022
Stocks have been unable to make up much ground since the June 16 lows, with a bear market rally amounting to only around a 4.3% gain in the S&P 500 Index since then (as of July 1). After the more than 6% rally the week of June 24 and the increasing optimism that...

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Relief at the Pump and for Portfolios?

June 27, 2022
2022 has been rough all-around for the American consumer. Not only are we battling decades-high inflation, but investors’ portfolios are off to one of the worst starts to a year in history as we near the halfway point...

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Bear Market Q and A

June 21, 2022
The bear market that started on June 13 has left the S&P 500 Index 23.5% below its January 3 high. After the initial positive reaction to the Federal Reserve’s first 0.75% rate hike since 1994 and tough talk on inflation, heightened fears of recession...

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Is the 60/40 Portfolio Dead?

June 13, 2022
This year has been tough for investors, not just because stocks have fallen but also because bonds have not helped mitigate those losses as they have historically done. Below we discuss the outlook for diversified portfolios of stocks and bonds to make the case that the 60/40 portfolio isn’t dead. 

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The Economy is Slowing but not Shrinking

June 6, 2022
Many pundits are issuing recession warnings and saying the economy is heading for a hard landing. Amid the cacophony of voices, we think the economy is slowing just like central bankers want but not shrinking. Further, we argue that a slowing economy is very different than a shrinking one. 

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Looking Through the Clouds

May 31, 2022
At the risk of sounding cliché, making the case for stocks to stage a second half rally back to the prior highs requires investors to see through some heavy cloud cover. If you prefer another market cliché, it’s times like these when investors need a crystal ball. We fully acknowledge how tough it is to see the bull case for stocks right now, and a retest of recent lows is certainly possible, but this week we lay out the bull case for the second half of the year. It starts with inflation.

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Dawn of a New Era for Core Bonds

May 23, 2022
Core bond investors have experienced the worst start to the year ever. However tough this year has been so far though (and it has been tough), the potential for future returns has improved meaningfully, in our view. Starting yields tend to be a good predictor of future returns and have become more attractive in a number of markets recently. With yields on most fixed income markets moving sharply higher, now could be a good time to revisit fixed income markets.

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Corporate America Delivers, Market Attention Focused Elsewhere

May 16, 2022
First quarter earnings season was solid by just about any measure, but based on recent market behavior it’s obvious that in general market participants paid little attention. This is a macro-driven market, so it will likely take positive macro developments, i.e., better news on the inflation front, to turn stocks around.

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Have We Really Seen Extreme Pessimism Yet?

May 9, 2022
It’s been a very tough start to the year with both stocks and bonds down sharply. Adding to the “wall of worry” for investors are the highest levels of U.S. inflation in decades, an aggressive Federal Reserve (Fed), Chinese lockdowns, and continuing war in Europe. So perhaps it is no surprise that investor sentiment polls are showing signs of extreme pessimism. 

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Why You Shouldn’t Sell Your Stocks in May This Year

May 2, 2022
“Sell in May and go away” is probably the most widely cited stock market cliché in history. Every year a barrage of Wall Street commentaries, media stories, and investor questions flood in about the popular stock market adage. In this week’s Weekly Market Commentary, we tackle this commonly cited seasonal pattern and why it might not play out this year, similar to recent years.

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Businesses and Consumers Likely Protected From Near-Term Recession

April 25, 2022
Not all recessions are created equal. Previous downturns in the U.S. were prompted by various shocks, with the most recent recession started by health and government-induced shutdowns. Other recessions started in the corporate sector, whereas some started from commodity shocks. The next one could start from geopolitical tensions. Nonetheless, we think the current business and consumer environments are safe from near-term recession risks. 

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What to Watch This Earnings Season

April 18, 2022
First quarter earnings season is rolling. BlackRock, Delta Airlines, Goldman Sachs, JPMorgan Chase, and Morgan Stanley were among the first 16 S&P 500 companies to report March quarter results, following 20 index constituents with quarters ending in February that had already reported. 

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Headwinds to Global Growth: An Economy of Two Halves

April 11, 2022
LPL Research reduced U.S. and global GDP forecasts due to Russian commodity disruptions, elevated inflation dynamics, and higher borrowing costs. Still, we expect the U.S. economy to grow 2.7-3.2% in 2022, supported by business investment and consumer services spending in the latter half of this year.

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LPL Research’s Stock Market Final Four

April 4, 2022
As the Final Four NCAA Basketball Tournament rolls on in New Orleans, we continue our tradition of picking a stock market final four. We have identified our four key factors for the stock market outlook: 1) Consumer spending, 2) Earnings, 3) Interest rates, and 4) Inflation. We also celebrate last year’s winner: COVID-19 vaccines. 

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Tempered but Optimistic Enthusiasm Over Stocks

March 28, 2022
As the stock market recovered from the 2020 pandemic lows, valuations reached levels not seen since the dotcom bubble more than 20 years ago. The reopening economy and massive fiscal stimulus helped fuel one of the strongest starts to a bull market ever (a bull market that just turned two-years-old last week).

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