Equity strategies focused on growth and momentum were the top-performing risk factors before the coronavirus crash and nothing’s changed during the market’s rebound from its March 23 low. Although all equity factors have bounced, growth and momentum have bounced higher, based on a set of exchange-traded funds through yesterday’s close (Sep. 17).
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Congress focuses on bill to avoid a government shutdown: WSJ
Judge blocks ‘politically motivated’ changes to US Postal Service: Reuters
China responds to US envoy’s visit to Taiwan with military drills: BBC
US economic confidence rebounds but still far below pre-pandemic level: Gallup
US housing starts fell in August–first monthly setback since April: NMN
Philly Fed Mfg Index: expansion continues in September but at slower pace: MW
US jobless claims fall more than expected, dropping to new pandemic low: CNBC

The Federal Reserve yesterday announced that it would keep interest rates near zero for “some time” until the economy generates full employment and inflation is “moderately” above the central bank’s 2% target. Judging by the new economic projections released by the Fed, rates will remain on hold for several years.

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Hurricane Sally leaves 550,000 without power on US Gulf Coast: BBC
Federal Reserve expects to keep rates near zero for years: CNBC
CDC chief: coronavirus vaccine may not be ready until mid-2021: WSJ
Are weekly jobless claims figures reliable? NYT
Snowflake stock more than doubles — largest software IPO in history: CNBC
Homebuilder sentiment increases to record high in September: CNBC
US retail spending continued rising in August: NYT

Lower For Longer: If it wasn’t already clear, the Federal Reserve has no plans to raise interest rates any time soon. Noting that inflation continues to run “persistently below” its 2% target and the labor market remains well below its “maximum” mandate for full employment, the central bank announced that it “expects to maintain an accommodative stance of monetary policy until these outcomes are achieved.”

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Since the US stock market hit bottom on March 23, the subsequent rally has been swift but uneven. An elite set of sectors have outperformed the broad market, based on a set of ETFs through yesterday’s close (Sep. 15). The majority, however, are still playing catch-up.
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Hurricane Sally remains a threat to US Gulf Coast states: CNN
Israel signs pact with two Gulf Arab states at White House: AP
US retail sales growth expected to slow in today’s August report: WSJ
Fed economic forecasts expected to edge up in today’s policy meeting: Reuters
OECD projects global GDP on track for “unprecedented” decline in 2020: CNBC
UK inflation falls to a five-year low: CNN
US import-price inflation increased more than expected in August: CNBC
NY Fed Mfg Index: growth picks up in September in bank’s region: MW
US industrial output growth continued to slow in August: Reuters

When a central bank announces a formal policy change to lift inflation it’s reasonable to expect that the government bond market would notice. But so far there are few signs that US Treasuries are reacting to last month’s roll out of the Fed’s average inflation targeting (AIT) policy, which is designed to “moderately overshoot” the 2% target for “some time,” the bank’s chair, Jerome Powell, explained last month.

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Hurricane Sally begins lashing Gulf Coast: Reuters
Historic Arab-Israel diplomatic deals set for signing ceremony today: AP
No relief in site from wildfires burning across US West: AP
Minimal guidance expected from Fed on new policy for setting rates: BBG
25 years of global progress on health and economics reversed this year: Politico
Researchers find no evidence of a small-cap risk premium: II
China’s consumer and industrial data show rebound continued in August: CNBC
German investor sentiment rises in September, beating expectations: Reuters
Consumer inflation expectations tick up to 3.0% for 1-year horizon: NYF
US economy’s full recovery will take additional 6 months without stimulus: BBG
Real Treasury yields stay negative for more than five months:

Investors had a tough time identifying a unified narrative for global markets last week, based on a set of ETFs. Performances ranged from a slight gain for equities in developed markets-ex US to a hefty loss for US shares, based on the trading week ended Sep. 11.
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