NEW YORK--(BUSINESS WIRE)--
Wall Street Webcasting has prepared and provided for you an exclusive broadcast of Wells Fargo Securities own, Rich Gordon. Gordon is highly recognized for his weekly narrates regarding the fixed income strategy at Wells Fargo Securities (NYSE: WFC). This week, Gordon discusses the surprising success seen in risk markets.
Risk markets, especially the large cap equity indices, have reached record highs lately. Late last week, the S&P had reached 1950, demonstrating an extraordinary increase for 12 out of 13 days in a row. It is now up 5.6 on the year, which is less than half of what the Spanish market has returned and about a third of what Italy’s market has returned; but is the same as Europe overall.
Wells Fargo analysts’ say that there are several things to be cognizant of in fixed income space. The 5 Year Treasury yield is up 20 basis points from late May. The 5s 30s spread is being watched closely. The moving average convergence/divergence, which is a trading indicator that is used to analyze stock prices, has been a good indicator of sell and buy signals on the 5 year treasury by combining elements of both momentum indicators and oscillators, since yields and prices move inversely.
The Mortgage Applications Index is down over 60% from last summer and is creating negative net supply; however, mortgage rates do not seem to be too much different from what they were last year. The housing market is not strong enough to where it can start to boost the economy. Cross sector investors continue to find better value in corporates than in NBS. There is better value and is more product to buy. The U.S. dollar has moved higher since May. This is due to several factors; one being that the ECB, along with other central banks, have a lot more work to do to keep a detrimental deflation from setting in.
To hear a more in depth explanation of which direction the Wells Fargo analysts believe the economy is heading, please tune into Wells Fargo’s latest video.
Please visit the following link to view the video:
- Banking & Budgeting
- Wells Fargo Securities
- Rich Gordon
Heather Capizzi, 201-683-2100