Markets & Economy

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.

Better Days: Earnings Growth Picks Up Sharply in 2017
by Liz Ann Sonders
February 13, 2017

We step away from the macro and focus on the micro of earnings and valuation... courtesy of the surge in the former, the latter looks reasonable.

Schwab Market Perspective: Not So Fast!
by Liz Ann Sonders, Brad Sorensen and Jeffrey Kleintop
February 10, 2017

Uncertainty among investors appears to be rising as the Trump administration attempts to race ahead with its policy priorities—what does it mean for stocks?

Schwab Sector Views: Trump Plus OPEC Equals …What for Energy?
by Brad Sorensen
February 09, 2017

Between OPEC cutting oil production and President Trump’s promise of economic stimulus, the energy sector should be rallying. Why isn’t it? 

Real Estate Sector: Underperform
by Brad Sorensen
February 09, 2017

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

Consumer Discretionary Sector Rating: Marketperform
by Brad Sorensen
February 09, 2017

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

Consumer Staples Sector Rating: Marketperform
by Brad Sorensen
February 09, 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
February 09, 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
February 09, 2017

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

Utilities Sector Rating: Underperform
by Brad Sorensen
February 09, 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
February 09, 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
February 09, 2017

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

Health Care Sector Rating: Outperform
by Brad Sorensen
February 09, 2017

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

Industrials Sector Rating: Marketperform
by Brad Sorensen
February 09, 2017

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

Telecommunication Services Sector Rating: Underperform
by Brad Sorensen
February 09, 2017

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

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.

Fed Leaves Rates Unchanged
by Liz Ann Sonders
February 01, 2017

The Fed surprised no one and left rates unchanged; while releasing a fairly "dovish" statement, which dented the probabilities for rate hikes at upcoming meetings.

Rise Up: Dow 20k Fails to Thrill Individual Investors
by Liz Ann Sonders
January 30, 2017

With the post-election surge in stocks, and the subsequent passing of 20k by the Dow, investor sentiment expectedly surged; but individuals have become wary.

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.

Not Fade Away: Will High Consumer/Business Confidence Fade or Persist?
by Liz Ann Sonders
January 17, 2017

Most measures of both consumer and business confidence have surged post-election; with consumer confidence likely more stable and business confidence possibly more fickle.

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.

Luminous Times: Looking Ahead With Optimism About 2017
by Liz Ann Sonders
January 03, 2017

The rally has been called the "Trump trade" but the economic and earnings inflection points pre-dated the election. Optimism is warranted, but greed should be kept in check.

Fed Shocks No One and Raises Rates
by Liz Ann Sonders
December 14, 2016

The Fed acted as expected and raised rates by 25 basis points; while also boosting its outlook and raising expectations for 2017 from two hikes to three.

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.

You’ve Got to Earn It: Valuations Aided by Improving "E"
by Liz Ann Sonders
December 05, 2016

Economic and corporate earnings momentum has picked up sharply heading into 2017; but the inflection point trend pre-dated the U.S. presidential election.

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.

Emotional Rescue: What to make of the post-election surge?
by Liz Ann Sonders
November 21, 2016

The post-election rally has been remarkable and likely reflects pro-growth policies expected next year; but also the long-awaited revival of animal spirits.

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.

Trump Pulls Off an Upset
by Michael T Townsend
November 09, 2016

Donald Trump pulled off an astonishing upset to win the White House. However, because he has provided less detail about his policy positions than a traditional campaign, it may take some time for markets to sort out his priorities. 

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.

With a Whimper Instead of a Bang: Is the Great Bond Bull Market Over?
by Kathy A Jones
September 27, 2016

U.S. Treasury yields may have bounced, but global economic weakness will likely keep them under pressure. 

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.

Negative Interest Rate Policy: What Is It and Could It Happen Here?
by Kathy A Jones
September 08, 2016

Five major central banks have lowered their countries' interest rates into negative territory. Why are they doing it, and could the U.S. Federal Reserve follow suit?

Mind the Gap: Are Earnings Expectations Too High?
by Jeffrey Kleintop
September 06, 2016

After a year and a half of cutting their earnings estimates for the world’s companies by a total of 14%, analysts have spent the past six months raising them. Are they now expecting too much?

Emerging Market Bonds: Curb Your Enthusiasm
by Kathy A Jones
August 30, 2016

Emerging market debt has delivered solid returns this year, but currency and default risks loom thanks to slow global growth and a potential rise in U.S. interest rates.

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.

What Does Strong Job Growth Mean for Bond Investors?
by Kathy A Jones
August 11, 2016

Healthy recent U.S. employment growth suggests the Fed could raise rates again this year. Here's what investors should consider doing now.  

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.

Earnings estimates are rebounding: what it means for stocks
by Jeffrey Kleintop
July 25, 2016

Analysts’ improving outlook for corporate earnings has tracked the trend of better than-expected economic data, helping to support stocks in the face of negative geopolitical events.

Turmoil in Turkey: What Does Coup Attempt Mean for Markets?
by Jeffrey Kleintop
July 18, 2016

Turkey's government re-established control following an attempted military coup over the weekend. We believe market reaction will be limited.

Three Reasons Why Now is Not the Time to Retreat from Global Diversification
by Jeffrey Kleintop
July 11, 2016

The Brexit is another in a series of political, economic and financial shocks coming from outside the United States. So is it time for long-term investors to retreat from global diversification to the perceived relative safety of the U.S. stock market?

After the Brexit Vote: What Lies Ahead for Markets?
by Jeffrey Kleintop
June 27, 2016

U.K. voters' decision to exit the European Union has rocked global markets. What will "Brexit" mean for investors going forward?

Brexit: What Does It Mean for the Bond Market?
by Kathy A Jones
June 24, 2016

Amid market turmoil, investors are flocking to U.S. Treasuries. What else can investors expect as a result of Brexit?

Global Bonds: A World Without Yield
by Kathy A Jones
June 16, 2016

Bond yields are so low that investors may find themselves paying to hold foreign bonds rather than being paid for it. Caution is advised.

What investors need to know about helicopter money
by Jeffrey Kleintop
June 13, 2016

The return of deflation in Japan has led some to call for the use of “helicopter money” which we see as unlikely to be effective at boosting growth, but may raise the risks to the global financial system.

Five ways investors can make the most of slower growth
by Jeffrey Kleintop
May 31, 2016

Making the most out of a slower growth environment may help define investment success in the coming years leading investors to find bright spots among mega-caps and emerging market stocks.

Bond Index Investing: Why You Should Track More Than One Benchmark
by Kathy A Jones
May 19, 2016

Bond market changes mean that even mutual funds and ETFs tracking a broad bond index could expose investors to more risk than they realize. 

Japan: Another Recession Coming?
by Jeffrey Kleintop
May 16, 2016

Japan’s economy is struggling and may be set to disappoint economists’ expectations for a sharp rebound in economic growth this year.

Eight Years Later: Europe’s Economy is Back and its Stocks are Leading Global Markets
by Jeffrey Kleintop
May 02, 2016

Europe’s improving economy pushed back above its prior peak eight years ago and has been helping lift European stocks above those of other developed markets.

Sign O’ the Times: Sell in May and Go Away?
by Liz Ann Sonders
April 25, 2016

With May upon us, investors will begin to ponder whether to “sell in May and go away,” while also reveling (?) in the Dow’s “Golden Cross.”

Mixed Signals From the Bond Market: Something’s Got to Give
by Kathy A Jones
April 21, 2016

If you’ve done well recently by investing in high-yield and long-term bonds, take heed: It’s unusual for both to outperform at the same time.

Earnings Season for Investors: It’s a Marathon, Not a Sprint
by Jeffrey Kleintop
April 18, 2016

The Boston Marathon offers investors an important lesson in behavioral biases for investors to keep in mind this earnings season as companies may lower their outlook for profits.

Will Rising U.S. Debt Levels Keep the Fed On Hold?
by Kathy A Jones
April 04, 2016

Rising interest rates could add to the national debt burden, but that isn’t likely to deter further Fed hikes.

What do the stock market trends in the first quarter mean for Q2 and beyond?
by Jeffrey Kleintop
April 04, 2016

Stocks’ wild ride and dominant themes in the first quarter hold key messages for investors about the second quarter and beyond.

Risks to the Rally: What Could End the Stock Market Rebound?
by Jeffrey Kleintop
March 21, 2016

Since the start of November the global stock market has been retracing the pattern seen in the second half of last year. We see three risks to the rally, but also see reasons to believe it is not over yet.

Trust but Verify: Five Independent Indicators of China’s Economy
by Jeffrey Kleintop
March 07, 2016

Some data coming out of China could be considered questionable. Learn where to look for a more accurate picture.

Don’t Look Back: Surviving in a Low-Yield World
by Kathy A Jones
February 25, 2016

The Fed's rate increase hasn't offered bond investors the relief they were seeking, so caution remains the order of the day.

Bargain Hunters Beware: Is the Rally for Real?
by Jeffrey Kleintop
October 26, 2015

Investors shouldn’t mistake the double-digit rebounds seen in some emerging markets this month as an all-clear sign to snap up bargains.

Is It Too Late To Buy Chinese Stocks?
by Jeffrey Kleintop
June 08, 2015

Investors should look beyond the headlines of a stock market bubble in China.