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Weekly Market Commentary

High quality research to help you make smart decisions with your money. 

LPL Research

Each week the LPL Financial Research team assembles thoughtful insight on market news. Check back here every week for the latest news on markets, economy, and investments.

Bear Market Q&A

June 21, 2022

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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 and that the Fed might “break something” sent stocks down for the 10th week out of 11 for only the second time in history (The first was in 1970). To help investors manage through this difficult period, we answer some of the top questions we’re getting about bear markets and list some things to watch to assess progress toward an eventual durable low.

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Is the 60/40 Portfolio Dead?

June 13, 2022

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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

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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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Dawn of a New Era for Core Bonds

May 23, 2022

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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. 

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Corporate America Delivers, Market Attention Focused Elsewhere

May 16, 2022

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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

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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. 

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

May 2 2022

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“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.

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Businesses and Consumers Likely Protected From Near-Term Recession

April 25 2022

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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

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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. Below we preview earnings season, highlight what we are watching, and share our latest thoughts on the 2022 profit outlook.

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Headwinds to Global Growth: An Economy of Two Halves

April 11 2022

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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

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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. 

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Tempered but Optimistic Enthusiasm Over Stocks

March 28 2022

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As the stock market recovered from the 2020 pandemic lows, valuations reached levels not seen since the dotcom bubble more than 20 years ago.

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Are Core Bonds Under Pressure?

March 21 2022

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Core bond investors have experienced one of the worst starts to the year ever, potentially calling into question the validity of bonds in a portfolio.

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Ready, Set, Rate Hike

March 14, 2022

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The Federal Reserve (Fed) meets this week and in all likelihood will raise short-term interest rates for the first time since emergency levels of monetary accommodation were provided to markets after the COVID-19 shutdowns.

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Downshift in U.S. Market Growth But Still Above Trend

March 7, 2022

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We currently expect the U.S. economy to grow 3.7% in 2022. The risks are to the downside since the Fed may err on tightening too fast, the recent commodity spike may trickle down to the U.S. consumer, and supply and demand imbalances may last longer than expected.

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How Soon Are Rate Hikes Coming?

February 28, 2022

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With inflationary pressures running higher than many central bankers are comfortable with, calls for interest rate hikes have become louder.

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Strong Earnings Momentum to Start 2022

February 22, 2022

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In our earnings preview on January 10, we noted that we welcomed a shift from the macro to the micro. Well, given the path of inflation, the resulting dramatic shift in Federal Reserve (Fed) rate hike expectations, and the escalating Russia-Ukraine conflict, that shift hasn’t really happened. 

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The Valentine's Day Index

February 14, 2022

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High inflation continues to cloud the economic outlook while its impact on the potential path of rate hikes has left markets unsettled. Inflation is a serious topic, but occasionally it’s useful to revisit it from a lighter perspective.

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Which Region Will Get the Gold in 2022

February 7, 2022

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The S&P 500 Index is down 5.6% year to date, outrun by the 3.8% and 0.9% declines in the MSCI EAFE Index (developed international equities) and the MSCI Emerging Markets (EM) Index. To assess which regional market might come out on top at the end of the 2022 competition, we take a look at global fundamentals, valuations, and technicals.

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LPL Research’s Sustainable Investing Year in Review

January 31, 2022

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Market volatility has been the dominant story for many investors in early 2022, but even as we focus on near term events it’s important to continue to track important market trends. 

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Potential Catalysts for a Market Turnaround

January 24, 2022

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After a tough start for stocks in 2022, investors are looking for reasons to expect a rebound. After more than doubling off the pandemic lows in March 2020, without anything more than a 5% pullback in 2021, stocks probably needed a break. 

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Don't Expect the Fed To End This Bull Anytime Soon

January 18, 2022

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The Federal Reserve (Fed) has engineered a massive hawkish shift, causing a bit more stock market volatility recently.

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Can Corporate America Keep it Rolling?

January 10, 2022

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As 2022 begins, it looks like that number may end up higher than the latest LPL Research estimate of $205, one of the biggest earnings upside surprises ever and a big reason why stocks did so well last year. 

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Three 2021 Market Lessons for 2022

January 3, 2022

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Welcome to the New Year for markets, when year-to-date returns all reset to 0% and the year ahead is still a blank slate. 

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