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Weekly Kickoff

Well last week was another record breaking week for equities with the S&P500 trading at record highs by 11 a.m. Friday–then the selloff began which sent the index down almost 2% where it closed. For the week the index ended up down 1% from the previous Friday–Monday was a wild ride for tech stocks as AI indigestion hit–but unless you owned the tech issues you probably did ok.

The 10 year treasury yield ended up down about 5 basis points from the previous Friday close. The yield was trading right down in the 4.50% area until midday and a serious realization of the ‘tariff’ issue and then rates headed higher closing the day at 4.57%. There was economic news during the week (GDP, FOMC rate news etc) which were not huge factors as the news generally met forecast.

This week the economic news is generally mild until we get to Friday when we have the December employment news being released.

The Federal reserve balances sheet fell by $14 billion last week–continuing as expected as the Fed has not changed their policies on balance sheet runoff.

Last week, in spite of interest rates falling on the week the down draft Friday afternoon sent prices down, The average $25/share preferred and baby bond fell by 17 cents. Investment grade issues fell 26 cents, banks were off 15 cents, mREITs fell 11 cents and shippers were off a nickel.

There was one new issue priced last week as Triton International priced a new perpetual preferred with a coupon of 7.625%. The container leasing company has 5 other outstanding preferred issues.

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