With so much attention focused on what the Federal Reserve (Fed) might do at its policy meeting next week, it’s a good time to look back at history to get a sense of how stocks might respond should the Fed hike rates as the market (barely) expects. LPL Research had been characterizing the rate decision as a coin flip until Chair Warsh’s hawkish comments at the Jackson Hole meeting and the strong August jobs report released last week. With the Fed fund futures market pegging the odds of a hike at 61% currently, we now believe the odds do, ever so slightly, favor a hike.

To get a sense of how stocks might react if the F

August delivered the loudest bond market narrative in years, and almost none of it survived contact with the price action. Total public debt crossed $40 trillion on August 18. The 30-year U.S. Treasury yield reached 5.33% intraweek, a level last seen in 2007. The move was global, with the German 10-year at 3.35% and the Japanese 10-year near 2.89%, both at, or near multi-decade highs. The federal deficit is tracking north of $2 trillion. Treasury Secretary Scott Bessent intervened with an expanded buyback program. A new Fed chair delivered his first Jackson Hole keynote. Commentators reached, predictably, for bond vigilantes, buyers' stri

In last week’s Beyond the Numbers, we made the case that free cash flow deserves a prominent place in investors’ valuation toolkits. Earnings can provide a useful measure of profitability, but free cash flow (FCF) gets closer to the central economic question: How much cash does a business generate after funding the investments required to operate and grow?

Capital requirements are rising alongside the cost of capital, and investors are paying closer attention to whether reported growth is translating into cash that ultimately accrues to owners. Our analysis found that FCF yield has historically been a more effective v

Much of the market's attention in recent weeks has centered on the sharp moves in long-term U.S. Treasury yields. Rising term premiums, concerns about debt issuance, and questions around the sustainability of fiscal policy have all helped drive volatility across the long end of the curve. But rising long-term yields are not just a U.S. story. Across the Atlantic, France is once again showing signs of becoming a focal point for sovereign bond investors.

One of the clearest signals is coming from the bond market itself. The spread between French and German 10-year government bond yields has widened recently and is now at levels