It’s been a case of one step forward, two steps back for municipal (muni) bond investors this year. What started out as one of the best January’s in recent memory for munis, quickly turned into one of the worst February’s on record. And monthly returns have been uneven since. So, what can muni investors expect the rest of the year? Some thoughts:

• The muni curve is almost always steeper than the Treasury curve due to uncertainty about future tax rates, as well as strong demand from individuals for bonds maturing within 10 years, and because longer-dated issuance is normally tied to the expected life of an

We know it’s old news at this point, but on June 8, 2023, the S&P 500 entered a new bull market. After such a strong rally off the October lows, this young bull probably needs a breather. A look at the charts suggests this market may be due for a pause. Bull markets are not linear. However, the impending end of the Federal Reserve (Fed) rate-hiking campaign, and the economy’s and corporate America’s resilience, help make the bull case that steers LPL Research toward a neutral, rather than negative, equities view from a tactical asset allocation perspective. 

New Bull Market Has Arrived

The S&P

Based on data released this week, the domestic housing market for both single and multi-family units had a very strong month in May. This is important because increased construction, especially of multi-family units, should help relieve some pressure on rents, and shelter has been one of the “sticky” components of inflation that has made it harder for the Federal Reserve (Fed) to justify a pivot in the current interest rate hiking cycle.

The U.S. Homebuilder Confidence Index released on Monday improved to an almost one-year high. The monthly report released by the National Association of Home Builders (NAHB) increased

As the economy is likely downshifting, investors should take heed that the Federal Reserve’s (Fed) current stance is eerily similar to early 2007.  During that time, the Fed held a tightening bias since they believed the housing market was stabilizing, the economy would continue to expand, and inflation risks remained. Clearly, their expectations were not met as the economy soon fell into recession. That’s not suggesting another 2008 is coming, but rather highlights how fast the economic environment can change. 

Overview

Forecasting regime shifts are difficult for both public policymakers and private i