Commodities

The U.S. economy remains resilient despite headwinds including sticky inflation, trade instability and rising geopolitical tensions. State and local government tax revenues have followed suit and have posted solid growth, aided by robust equity market returns.

The S&P 500 has remained remarkably resilient in the face of mounting macro headwinds. Despite oil prices topping $100 per barrel, 10-year Treasury yields climbing above 5%, and a renewed shift toward tighter monetary policy, the index continues to hover near record levels.

Second-quarter earnings were strong, particularly in technology, but crowded ownership often determined whether good news was rewarded. The selloff in semiconductors arguably reflected crowded positioning and concerns surrounding the sustainability of the earnings boom. The net result: multiples compressed while earnings revisions held up.

Artificial intelligence (AI) leadership is no longer a developed-market monopoly. Emerging markets (EM) now have their own AI champions, and productivity gains may follow. For bond investors, we expect the implications to differ by country—driven by industry composition, capital intensity, digital infrastructure and speed to adoption.

The Treasury Department will buy back another $6 billion in long-term Treasuries today (Thursday, Sept. 24) as it continues efforts to tamp down rising yields.

In September 2024 and June 2025, I wrote memos that were critical of governments’ attempts to override the laws of economics, based on my conviction that trying to do so is likely to prove ineffective and potentially harmful.

This week, there are a few things that we need to pay attention to: the large move in interest rates and what it means (and more importantly, what it doesn’t mean!); and the constant barrage of doom and gloom on energy and AI. Let’s jump in.

I do not know whether quantum computing is in that kind of window right now. Nobody does, and I am suspicious of anyone who claims certainty in either direction. What I can say is that the pattern-matching is uncomfortably familiar.

Creating significant wealth requires concentration of capital, attention, risk, and decision-making.

Last week we looked at the Federal Reserve’s inflation problem. This week, let’s look at the other half of its mandate: maximum employment.

This year has presented no shortage of challenges for investors. Geopolitical conflict, trade tensions, rising energy prices, shifting interest rate expectations and an increasingly active political backdrop have each taken turns dominating the headlines. Yet despite these obstacles, the economy has continued to expand, corporate profits have marched higher and markets have climbed one wall of worry after another.

Confluence Investment Management offers various asset allocation products, which are managed based on “top down,” or macro, analysis. We publish asset allocation thoughts on a bi-weekly basis, updating the report every other Monday, along with an accompanying podcast.

Doshi said gold holding $4,000 during the correction and later rallying to $4,700 before last week's Fed rate hike strengthened his conviction that the broader gold bull market remains intact despite continued headwinds from the Iran war oil shock.

The Federal Reserve hiked rates, and we expect there are more to come. With a hawkish Fed and a resilient economy, long-term yields may stay elevated.

The U.S. economy has traveled farther than most forecasters expected. Strong household spending, healthy labor markets and continued business investment have kept the expansion on course.

The rise in Treasury yields has prompted a familiar set of explanations. Some investors have pointed to government borrowing and persistent inflation, while others have focused on the possibility that artificial intelligence will lift economic growth and interest rates.

Investment bubbles are inherently dangerous beasts. Like a natural Ponzi scheme, an investment bubble needs to draw in ever larger amounts of capital to keep it going. Nothing attracts capital like apparent success, so an inflating bubble that is creating fortunes for those who got in early will inevitably draw in capital. Unfortunately, this means the amount of money lost when the bubble bursts can outstrip the gains created on its way up.

Looking ahead, markets are priced for additional hikes. And our base case is that the FOMC will likely deliver one or two more 25-bp rate hikes through this year and into early next. However, looking further out, anticipating appropriate Fed policy through a financial-conditions-targeting framework has its own limitations. Hence, a neutral rate anchor is still useful.

LPL Research analyzes S&P 500 margin expansion, assessing how much is structural versus cyclical and what that means for future earnings forecasts.

It’s really starting to feel like autumn now. August PPI, CPI, and Retail Sales are in the books, the September FOMC meeting is out of the way, and we can now look forward to Jobs Week on Wall Street. Football is in full swing, and earnings season begins before you know it, with Pepsi (PEP) posting results on Thursday, October 8, followed the next morning by Delta (DAL).

Global growth remains resilient but uneven. In the United States, expansion is supported by private demand, a stable labor market and AI investment, while Europe and Japan continue to show surprising strength despite ongoing risks.

Artificial intelligence (AI) technologies are developing faster than investors anticipated just a few years ago, fueling a popular narrative that AI will trigger widespread job cuts. Yet there’s little evidence to back this view. Instead, we find that AI is changing hiring patterns, altering skill requirements and shifting the mix of work performed within firms.

While the AI trade absorbs nearly all available investor attention, owning energy covers our absolute risk while creating the risk budget to cover the AI relative risk more effectively.

Major US equity indices finished the week mixed. The NASDAQ gained 0.7 per cent while the Dow and S&P 500 slipped. The divergence reflected a tug-of-war between fears of slower AI development early in the week and a rebound in AI-linked shares by Friday.

For many advisory firms, portfolio management creates a practical tension. Standardized models can simplify implementation and support scale, yet they may not reflect a firm's investment philosophy, tax realities, legacy holdings or preferred managers. Building every portfolio internally preserves control, but it also demands time, systems and ongoing investment oversight.

The Texas Stock Exchange (TXSE) is more than a regional milestone — it is a shift in competition among U.S. capital markets. After months of anticipation, the TXSE reached a major landmark last week as Texas Capital’s TXS and OILT ETFs became its first primary listings, followed a day later by PWRX as the first new ETF to launch on the exchange.

Markets have dealt with serious whiplash from the Federal Reserve’s dramatic policy pivot this year. In just six months, the Fed funds futures market went from pricing in two rate cuts totaling 50 basis points to now pricing in two rate hikes in 2026.

Federal Reserve (Fed) chair Kevin Warsh has established his hawkish credentials. Franklin Templeton CIO, Sonal Desai sees scope for further yield curve steepening and a range of selective opportunities, based on capturing income and focusing on quality rather than counting on lower rates or tighter spreads.

It wasn’t that long ago that Kevin Warsh’s leading critics were saying his biggest problem was that he wasn’t “independent” from President Trump, that if Trump told him to “jump” he’d ask “how high?” Or, in this particular situation, “how low should interest rates go?”

The week began with calls for a potential slowdown in AI spending amid growing safety concerns and included a midweek Fed rate hike for the first time since 2023. The S&P 500 finished slightly lower for the second week in a row despite continuing signs that economic growth is strong. Shorter-term bond yields pushed higher as investors priced in the potential for additional rate hikes, both in the U.S. and abroad.

Some economists and market participants view inflation as one of the most important economic indicators. Market participants spend a lot of time worrying about a lot of things, but inflation is pretty close to the top of the list most of the time.

Dividend growth is back, and it’s fair to say that outperformance among dividend growth stocks may simply be overdue amid a shift in U.S. equity market leadership beyond a small group of mega-cap technology companies.

Share buybacks are when a company purchases its own shares, reducing the total number of shares on the market. Oftentimes, these buybacks occur on the open market, but companies may also look to buy shares from existing shareholders as well.

Goldman Sachs Asset Management launched two new ETFs Monday, expanding exposure to emerging and international equities. The ETF duo includes the Goldman Sachs Data Enhanced Emerging Markets Equity ETF (GEMQ) and the Goldman Sachs Data Enhanced International Equity ETF (GIEQ). That pair joins an ETF landscape in which those segments are seeing growing interest.

Early this week, I was in Los Angeles at the All-In Summit along with about 4,000 others, including tech investors, money managers and entrepreneurs. The ticket wasn’t cheap, but it was well worth it.

In August, a flurry of ETF-related deals were announced and expected to close by early 2027. Goldman Sachs is buying NEOS Investments. T. Rowe Price plans to add F/M Investments. Victory Capital is acquiring First Eagle.

As summer officially gives way to fall on September 22, it's not just the weather that's changing. The global monetary policy landscape is shifting as well. After spending much of the past two years focused on supporting growth, central banks have increasingly turned their attention back to inflation, especially with oil prices climbing back above $100 per barrel.

I typically avoid business books when I am on vacation. But I made an exception during our sojourn last month for Andrew Ross Sorkin’s 1929. Nearly a century after the Great Crash, that era is still being studied for lessons that might be relevant in the current day. The potential for financial instability is ever-present.

Throughout this Indexing Redefined series, we explored how traditional market-capitalization indexing ties portfolio weights directly to stock prices, creating hidden concentration risks. Furthermore, we discussed how fundamental indexing offers a disciplined alternative by weighting companies according to their real-world economic footprint. In this final installment, we address the dilemma investors face in highly concentrated equity markets.