Carlsquare weekly market letter: Can Junk lead the way?
1 Mar 2023
Read the weekly market letter here:
Carlsquare Weekly market letter
- In line with our expectations, equities performed poorly in February. With that month out of the way, we start today on a fresh note as we move into March. Friday’s US jobs report will be exciting as a stronger USD weigh on equities.
- The junk bond market, as reflected in the traded ETFs HYG and JNK, tends to be a good signal for the stock market. HYG is in an uptrend. If this continues, the general market can follow!
- The chart below illustrates the seasonality of the market (S&P500 index). February is usually a weak month. This is probably because the reporting season dries up in the latter part of the month. As spring arrives with fresh air and blue skies, March-April and May are stronger. With the Q1 reports in April-May, some reality comes back, and the stock market tends to slow down again.
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