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Market & Portfolio Review: 6-2-22

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Can Stocks and Interest Rates Both Go Up?

Ever since the Federal Reserve announced its pivot against inflation back in November, it’s been rough sledding for stocks. The combination of high inflation, the war in the Ukraine, and higher interest rates have investors asking if it’s even possible for stocks to go up in such an environment. We think the good news is that once stocks price in news, prices tend to rapidly reset, which then allows stocks to move on from the current news cycle. This means that stocks can often climb a wall of worry or move lower on a sea of optimism. Moving forward, we believe that most interest rate increases have been priced into stocks, have reset valuations, and now offer investors a moment to buy into attractive growth companies.

Key Takeaways

  1. We see many commodities are quietly selling off, which should ease inflationary pressures. 
  2. We believe stocks are trying to carve out a bottom, but we need to see a break above prior breakdowns to increase our level of confidence 
  3. We think Interest rate expectations are beginning to fall as growth and inflation slow

The information here is presented by licensed professionals and not specific to any individual’s personal circumstances. Investment advisory services offered through LifePro Asset Management, LLC, a SEC registered investment adviser. Investments involve risk and are not guaranteed. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment or investment strategy will be profitable or equal any historical performance. Discussion of any specific stocks are based on objective, non-performance criteria and such discussion neither serves as a recommendation nor as the receipt of, or a substitute for, personalized advice. Due to various factors, including changing market conditions, such discussion of positions and/or recommendations may no longer be reflective of current position(s) and/or recommendation(s). Moreover, no client or prospective client should assume that any such discussion serves as the receipt of, or a substitute for, personalized advice from Advisor, or from any other investment professional. Forward-looking statements such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” are based on management’s views and assumptions at the time such statements were originally made and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. LifePro Asset Management does not undertake any obligation to correct or update any forward-looking statements on the LPAM Site.

Robert Reaburn

Robert Reaburn

Robert Reaburn is the Executive Vice President and Head of Wealth Management at LifePro Asset Management. He works with financial advisors building diverse financial portfolios that best empower their clients with a lifetime of financial security.

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