Investment Review - December 2022
- The major U.S. stock indices continued to make gains in the 4th quarter. For the month of November, the Dow Jones Industrial Average returned 5.6% (price return) with the S&P up 5.3% and the tech heavy Nasdaq Composite advancing slightly less at 4.3%.
- Yields on longer-term U.S. Treasuries have fallen further below those on short-term treasuries to the widest spread in decades, a sign often seen as a red flag that a recession is looming. Recessions are inevitable; the timing is difficult. The recent increase in the treasury yield curve inversion is likely due to better than expected economic news and investor’s expectations that the Fed will win the inflation effort longer term. In the meantime, the market will have to bear higher short-term interest rates.
Sources: Bloomberg LLC, FactSet, U.S. Department of Labor
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