Markets & Economy

Fed Keeps it on the QT
by Liz Ann Sonders
July 26, 2017

The Fed surprised no one by holding off on raising rates, but added a teaser to the statement suggesting quantitative tightening (QT) could begin in September.

An important benefit to global investors is back after 20 years
by Jeffrey Kleintop
July 24, 2017

What's happening in the markets that could benefit investors?

Schwab Market Perspective: Are Danger Signs Rising…or Will the Bull Run Continue?
by Liz Ann Sonders, Brad Sorensen and Jeffrey Kleintop
July 21, 2017

Risks of a pullback appear to be rising, but this bull is resilient and continues to run.

Schwab Sector Views: One half down, one to go!
by Brad Sorensen
July 20, 2017

A view on where sectors stand at the midway point.

Consumer Staples Sector Rating: Marketperform
by Brad Sorensen
July 20, 2017

Schwab's view on the consumer staples sector, which includes consumer items that tend to be viewed as household necessities.

Materials Sector Rating: Marketperform
by Brad Sorensen
July 20, 2017

Schwab's view on the materials sector, which describes an array of commodity-related manufacturing industries.

Information Technology Sector Rating: Outperform
by Brad Sorensen
July 20, 2017

Schwab's view on the information technology sector, which covers most makers and providers of computer, data, and electronic equipment and services.

Real Estate Sector: Underperform
by Brad Sorensen
July 20, 2017

Schwab's view on the real estate sector, which covers companies involved in real estate and includes equity REITs.

Health Care Sector Rating: Outperform
by Brad Sorensen
July 20, 2017

Schwab's view on the health care sector covers health care equipment and services as well as  pharmaceutical and biotechnology companies. 

Telecommunication Services Sector Rating: Underperform
by Brad Sorensen
July 20, 2017

Schwab's view on the telecommunications sector, including operators of telecom networks and providers of communications and data transmission services.

Consumer Discretionary Sector Rating: Marketperform
by Brad Sorensen
July 20, 2017

Schwab's view on the consumer discretionary sector, which covers companies that sell non-essential goods and services. 

Utilities Sector Rating: Underperform
by Brad Sorensen
July 20, 2017

Schwab's view on the utilities sector, which covers a variety of industries that generate and deliver power and water. 

Financials Sector Rating: Outperform
by Brad Sorensen
July 20, 2017

Schwab's view on the financial sector, which encompasses the financial services industry and is often referred to by the acronym FIRE, for finance, insurance and real estate.

Energy Sector Rating: Marketperform
by Brad Sorensen
July 20, 2017

Schwab's view on the energy sector, which encompasses companies that help produce and distribute energy.

Industrials Sector Rating: Marketperform
by Brad Sorensen
July 20, 2017

Schwab's view on the industrial sector, which includes providers of capital goods, commercial services, transportation services and infrastructure.

Dollar Decline: Time to Shift to International Bonds? Maybe Not
by Kathy A Jones
July 12, 2017

The U.S. dollar weakened in the first half of 2017, leading some investors to wonder whether a key attraction of U.S. bonds is likely to fade away—and whether they should consider investing in international developed market bonds instead. Here’s what investors should know.

Where’s the Next Bubble?
by Jeffrey Kleintop
July 10, 2017

The current candidates for the next bubble do not seem to fit the classic bubble profile and may cause less potential damage if they were to burst, but that doesn't mean they don't carry risks for investors.

2017 Mid-year US Equity Outlook: Rattle and Hum
by Liz Ann Sonders
July 03, 2017

Neither partisan conflict nor monetary policy uncertainty has dented the U.S. equity bull market; but are risks rising in the second half?

2017 Mid-year Global Market Outlook: Broader Growth, Narrower Risks
by Jeffrey Kleintop
June 26, 2017

Global stocks may continue to rise in the second half of the year supported by broad global economic growth and receding political risks.

The Space Between … Tech Today Doesn't Resemble Tech Circa 2000
by Liz Ann Sonders
June 19, 2017

Since the 5% pullback in the S&P 500's technology sector some are drawing parallels to the bubble peak in 2000; which we think is a stretch.

Bond Market Mid-Year Outlook: Redefining the Borders of ‘Lower for Longer’
by Kathy A Jones
June 16, 2017

In the second half of 2017, we expect10-year Treasury yields to remain in a 2% to 2.5% range, consistent with the eight-year “lower for longer” theme in the bond market.

Fed Raises Rates, Sticks With Plans for One More Hike This Year
by Kathy A Jones
June 14, 2017

As expected, the Federal Reserve raised its benchmark target rate at its June meeting. However, the market seems less concerned about inflation than the Fed does. 

Are bonds signaling a major stock market peak?
by Jeffrey Kleintop
June 12, 2017

Does the flattening yield curve in the bond market and rising prices in the stock market reflect a fundamental disagreement on the prospects for the global economy?

Turn Down For What: Why is Job Growth Slowing?
by Liz Ann Sonders
June 05, 2017

Weaker job growth raises concerns, but there are reasons not to worry; and reasons to believe wage growth is stronger than traditional measures show.

Will the Fed Reduce Its Balance Sheet? What Bond Investors Should Know
by Kathy A Jones
June 01, 2017

The Federal Reserve may soon announce plans to reduce the size of its balance sheet. What does that mean, and should bond investors be concerned?

The Long Period of Underperformance for Emerging Market Stocks May Finally Be Over
by Jeffrey Kleintop
May 30, 2017

The end of the long period of emerging market stocks’ underperformance is supported by a recent change in trend for each of the four drivers of emerging markets.

Gimme Three Steps … and a Stumble?
by Liz Ann Sonders
May 22, 2017

The Fed will continue to raise rates, which shouldn’t alarm investors; but the addition of quantitative tightening (QT) via balance sheet shrinkage could drive volatility.

Is The Stock Market Just Quiet Or Is It Too Quiet?
by Jeffrey Kleintop
May 15, 2017

Does the low volatility and trading volume of this quietly rising stock market mean it’s vulnerable to a sharp pullback on any piece of bad news?

Strange Brew: Heightened Uncertainties, Yet Plunging Volatility…What Gives?
by Liz Ann Sonders
May 08, 2017

Volatility as measured by the VIX is plumbing record lows, but is it a sign of heightened investor complacency, or are there other explanations?

What the Coming Tax Cuts Mean for the Stock Market
by Jeffrey Kleintop
May 01, 2017

The leaders of most major countries are implementing or calling for corporate tax cuts. This may be welcome news for stock market investors since it could mean a boost to after-tax profits.

½ Full: Seeing Through a Weak Q1
by Liz Ann Sonders
April 24, 2017

Although economic surprises have weakened noticeably, and hard economic data has been sluggish; leading indicators continue to flash green for the US economy.

Three Reasons to Own Bonds When the Fed is Raising Interest Rates
by Kathy A Jones
April 19, 2017

Even in a rising rate environment, bonds can offer three key benefits: diversification, capital preservation and income.

Missiles and Markets: An investor guide to geopolitical risks
by Jeffrey Kleintop
April 17, 2017

The long history of U.S. missile strikes and NATO military operations shows us that the market impacts of these geopolitical conflicts have been small and brief.

One of These Things ... Market's Moves Not All About Trump
by Liz Ann Sonders
April 10, 2017

Much of the improvement in the economy and the latest stock market rally has been credited to Trump; but perhaps there is an alternate story.

Emerging Market Bonds: Can the Hot Start In 2017 Continue?
by Kathy A Jones
April 06, 2017

Emerging market bond prices have surged in 2017, but valuations are stretched and risks remain.

Top Five Trade Issues Investors Should Be Watching
by Jeffrey Kleintop
April 03, 2017

World trade is steadily rising, but changing trade agreements hold the potential to shape the direction of global trade and stock markets.

The Fed has China in a Tough Spot
by Jeffrey Kleintop
March 20, 2017

The Fed rate hike has put China in a tough spot in early 2017. How China responds will be important for global markets as investors assess the trade fallout and growth trajectory for the world’s second largest economy.

The future of Europe: EU 2.0 and its impact on the markets
by Jeffrey Kleintop
March 06, 2017

What does Europe’s future look like and what might it mean for investors?

Closed-End Bond Funds: How They Work and What You Should Know As Rates Rise
by Kathy A Jones
March 02, 2017

Closed-end bond funds are a popular way for investors to garner extra yield when interest rates are low, but rising rates can negatively affect their performance. Here’s what you should know about these investments.

What would a shake-up at the Fed mean for bond investors?
by Kathy A Jones
February 28, 2017

Significant turnover will likely hit the Fed in the next few years. The changes may result in a shift in the way the Fed sets policy. 

The stock market sees nothing to worry about—that may be about to change
by Jeffrey Kleintop
February 21, 2017

Stock markets are currently behaving as if there is nothing to worry about, but that may be about to change now that we are within 45 trading days of the French Presidential election.

Simple Indicators In A Complex World
by Jeffrey Kleintop
February 06, 2017

When people feel there is a situation that is out of their control or too complicated to analyze, they often fall back on rules of thumb to make decisions.

Five Reasons to Stay Invested Despite Heightened Uncertainty
by Jeffrey Kleintop
January 23, 2017

There are five reasons to stay invested despite the heightened uncertainty.

Anatomy of a Bond Bear Market: What to Look For When Yields Rise
by Kathy A Jones
January 19, 2017

With yields surging from last summer’s record lows, are bonds at the start of a long-term bear market? To answer that question, you must first determine what constitutes a bear market in bonds.

The CURE for a calm market: Four risks for 2017
by Jeffrey Kleintop
January 09, 2017

After a calm post-election climb for stocks, developments in China, United Kingdom, Russia, and Europe may bring a return of volatility.

Will the U.S. Dollar Bull Market Continue in 2017?
by Kathy A Jones
January 05, 2017

The U.S. dollar looks set to continue rising this year, but the risks to the rally increase as the bull market ages.

Changing Conditions: A Bond Market FAQ
by Kathy A Jones
December 13, 2016

Yields have surged and potential changes in taxes, government spending and interest rates could make the bond market more volatile. What does it mean to investors?

5 Reasons International Stocks May Underperform in 2017
by Jeffrey Kleintop
December 12, 2016

There are five key reasons developed international stocks may lag U.S. stocks again in 2017.

Bond Market Outlook: Higher Rates and Known Unknowns
by Kathy A Jones
December 01, 2016

The incoming administration’s proposals for taxes, spending and trade could create waves in the bond market. Caution may be in order.

Happy Unrecession: The Alice in Wonderland economy
by Jeffrey Kleintop
November 28, 2016

While the odd and upside-down developments confronting investors may seem mad, the stock market gains are not as misguided or illogical as they may at first seem.

President Trump and Global Trade: How Will Campaign Promises Play Out?
by Jeffrey Kleintop
November 10, 2016

Even if he carries out his most aggressive campaign proposals, we believe the consequences could be less damaging than they might at first seem.

Change Is in the Air: A Post-Election Look at Bonds
by Kathy A Jones
November 09, 2016

The election results look set to continue the shift toward increased fiscal spending and higher inflation, but some caveats are in order.

Recession Odds Pass Key Threshold
by Jeffrey Kleintop
October 31, 2016

A reliable historical indicator suggests the events of October may have been more soothing than scary for long-term investors.

Three Reasons Stocks May Avoid Another Lost Decade
by Jeffrey Kleintop
October 17, 2016

The end of September marked 10 years with no growth in earnings and nine years with no gain in the stock market—what will the next 10 years offer investors?

Are Bond Yields About to Rise?
by Kathy A Jones
October 06, 2016



Going Godzilla: What has the Bank of Japan Unleashed?
by Jeffrey Kleintop
October 03, 2016

The Bank of Japan faces a rising risk that their policy has created a monster that may be getting harder to control.

World Tour: An Around The World Look At the Economic Landscape
by Jeffrey Kleintop
September 19, 2016

The global picture may have brightened a little, thanks largely to Asia, but with little momentum to that improvement.

Your portfolio may be less diversified than you think
by Jeffrey Kleintop
August 22, 2016

Investors with a large home bias in their portfolio may not be nearly as diversified as they believe.

Does Zika pose an Olympic-sized risk to stocks?
by Jeffrey Kleintop
August 08, 2016

While the threat of Zika at the Olympic Games may garner headlines, past world pandemics show us that the market impact has not been significant—even when the global economy was especially vulnerable to a shock.