This year has posed significant challenges for US stocks. However, amidst these difficulties, the category of equities that offer comparatively higher dividend yields stands out as a notable exception, showing some resilience.
- * The OECD downgrades its global growth forecast for 2022 to +2.9%, significantly down from January’s estimate of +4.1%
- * Inflation is set to remain elevated, Treasury Secretary Yellen informs lawmakers
- * Progressive politics faced backlash in California’s Democratic primaries, as reported
- * It seems that the tech sector’s decade of market dominance has concluded
- * The Eurozone’s economic growth for Q1 has been revised upwards to +0.6%, up from +0.3%
- * Japan’s Q1 GDP has been corrected to +0.5%, a recovery from a previously reported decline of 1%
- * Global supply chain pressures have eased in May, reversing the previous month’s spike:
- * Boris Johnson survives a confidence vote, remaining as UK Prime Minister
- * Taiwan prepares for a potential invasion from China
- * Treasury Secretary Yellen faces difficult inquiries regarding inflation in Congress this week
- * Although global growth remains sluggish, it was slightly stronger in May, as noted here
- * In China, services-sector business activity “continues to decline significantly in May”
- * Rising interest rates are impacting commercial property sales
- * The world has hit its peak agricultural land
- * German manufacturing orders declined for a third consecutive month in April
- * The yield on the US 10-year Treasury has rebounded, rising above 3% once more:
Update: In a stroke of luck, my flight from Honolulu to Newark (with a layover in San Francisco) arrived ahead of schedule in Newark. It feels like I’ve won the airline lottery! This means I’m back in the swing of things sooner than anticipated.
Currently, the Capital Spectator is somewhere over the continental US, returning from a week-long stay in Waikiki. I’m getting ready to transition back to my regular life in the Gah-den State, also known as New Jersey. A debrief on my time away will resume tomorrow, Wednesday, June 8. Meanwhile, here’s one last glimpse at what I’m departing, trading it in for a less glamorous location around 30 miles southwest of Wall Street.
- * Russia targets Kyiv with missiles as Putin issues a warning to the West regarding arms
- * In response to North Korean missile launches, the US and South Korea launch missiles of their own
- * A recession in the US may be avoidable if the Fed’s decisions are both timely and precise
- * Cleveland Fed president indicates that a series of aggressive rate hikes may be necessary
- * Growth in the US services sector slowed in May, reaching its lowest level in over a year
- * US payrolls increased by 390,000 in May, maintaining the Fed’s path for half-point rate hikes
● Direct: The Rise of the Middleman Economy and the Power of Going to the SourceKathryn Judge
Review via The Economist
In 2011, an E. coli outbreak in Germany caused thousands to fall ill. Authorities initially thought contaminated salad ingredients were the culprits but were unsure which items were unsafe. Their first assumption pointed to Spanish cucumbers, leading consumers to avoid this product. Ultimately, it was discovered that salad sprouts cultivated in Germany were responsible. Kathryn Judge, a professor at Columbia Law School, explains that complex supply chains have created confusion in identifying product origins. This situation is reminiscent of the subprime mortgage crisis of 2007, where repackaging of loans obscured their safety to investors, subsequently enhancing panic.
- * The Fed initiates the process of reducing its $8.9 trillion balance sheet to combat inflation
- * OPEC decides to increase oil production in light of decreasing Russian output
- * China is preparing to unveil an aircraft carrier that will extend its military influence globally
- * US factory orders and shipments show modest growth for April
- * Jobless claims have remained steady, nearing multi-decade lows
- * The ADP indicates that hiring by US firms in May was the slowest of the recovery:
- * US job openings remain elevated in April as companies face challenges filling positions
- * Saudi Arabia states it will increase oil production should Russia’s output drop dramatically
- * President Biden is reportedly planning to visit Saudi Arabia due to soaring gasoline prices
- * Mortgage rates in the US have increased sharply after a period of easing
- * The Fed’s Beige Book reports modest or slight economic growth recently
- * Global manufacturing output declined for the second consecutive month in May according to PMI data
- * US construction spending increased but fell short of expectations in April
- * The US ISM Manufacturing Index rose in May, indicating ongoing moderate growth:
- * The US has decided to send advanced rocket systems to Ukraine, potentially escalating the conflict
- * China is reported to have dispatched 30 warplanes near Taiwan during a significant training operation recently
- * The country has also begun easing the Covid lockdown in Shanghai, a crucial economic and trade center
- * In May, contraction in manufacturing activity in China saw some easing, according to Caixin PMI data
- * Eurozone inflation reached an annual rate of 8.1% in May, a new record
- * The Chicago PMI improved in May, surpassing expectations
- * Treasury Secretary Yellen acknowledged that her prior views on inflation were incorrect
- * Is the US providing Ukraine with momentum that is “impossible to halt” in the ongoing war?
- * High inflation rates and increasing interest rates weakened consumer confidence in May:
- * EU leaders reach an agreement on a partial ban of Russian oil imports
- * While manufacturing sentiment in China shows improvement in May, it remains in a contracting phase
- * Eurozone economic sentiment remains steady in May
- * President Biden stated his support for the Fed to lower inflation through decreased demand
- * The US Consumer Sentiment Index was revised down for May:
This compilation of economic updates illustrates varied developments across the global market landscape. While challenges remain, particularly for the US stock market, sectors such as high-dividend equities offer a glimmer of hope amid uncertainty. Keeping a close eye on these trends will be crucial for investors and stakeholders alike.
