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Section: Thought Leadership

Thought Leadership

Monday Morning O'Malley

A weekly take on the economy and the market, from Dave O’Malley, Chairman & Chief Executive Officer of Penn Mutual Asset Management.

  • Inflation Data Disappoints
    October 16, 2017
    The Consumer Price Index (CPI) increased by 0.5% for the month of September but was lower than expected. Despite a tight labor market, strong economic conditions and increasing commodity prices, inflation has remained lower than expected throughout 2017.
  • Fundamentals Rule the Day
    October 12, 2017
    The daily record highs in the equity markets and the relentless grind tighter in the credit markets elicit both feelings of marvel and trepidation.
  • Underlying Employment Strength
    October 9, 2017
    Last week’s September employment report showed weakness in the headline jobs gained number but significant underlying strength in other measures.
  • Fed Continues Hawkish Tone
    September 25, 2017
    The stock market held near record levels and interest rates were stable after the Federal Reserve (Fed) announced its much anticipated plan to shrink its balance sheet last week.
  • Stocks Make a New High
    September 18, 2017
    The S&P 500 closed above the 2,500 mark for the first time on Friday. The markets ended a strong week of gains driven by continued favorable conditions for economic growth and the prospects for potentially bipartisan action coming out of Washington.
  • Hurricane Recovery and Economic Impact
    September 11, 2017
    The one-two punch of Hurricanes Harvey and Irma has impacted so many in Texas, Florida and throughout the Southern part of the U.S. We keep all of those impacted in our thoughts and wish them a speedy recovery.
  • Unexpectedly Weak Employment Report
    September 5, 2017
    The nuclear test by North Korea has brought geopolitical uncertainty to a new level. As I have previously written, it is very hard to trade geopolitical risk so I prefer to stay focused on fundamentals.
  • Treasury Auctions and Inflation Data
    August 7, 2017
    Last week’s employment data confirmed the strength of the jobs market with 209,000 new jobs added during July versus an expected 180,000.
  • Earnings Heat Up This Week
    July 17, 2017
    Second quarter earnings will receive significant attention this week, as stocks pushed to new highs on the S&P 500 Index last week.
  • Bond Yields Rise Around the Globe
    July 10, 2017
    Bond yields have been rising around the globe for the last few weeks as central bankers discuss the continued normalization of monetary policy.
  • Waiting for the Healthcare Vote
    June 26, 2017
    The week ahead has limited economic data. Durable goods were down 1.1% for May and likely fell on weaker demand for airplanes.
  • Beware of a Flattening Yield Curve
    June 19, 2017
    In a much anticipated move last week, the Federal Reserve (Fed) increased short-term interest rates by 25 basis points (bps).
  • Sell in May and Go Away?
    May 30, 2017
    As we reach the end of May, I was thinking of the old trading adage “sell in May and go away,” or the recommendation to sell stocks in May and buy them back in November, therefore avoiding the historic volatility that has occurred in the June to October period.
  • Staying Focused on the Big Picture
    May 22, 2017
    Over the past few months, I have been asked many times how to factor the news cycle and developments in Washington into market expectations.
  • Stocks Rally on French Election
    April 24, 2017
    The results of the first round of French elections sent stocks around the world higher in early trading on Sunday. Emmanuel Macron and Marine Le Pen will advance to the second round of voting on May 7.
  • The First Week of the Second Quarter Expected to be Busy
    April 17, 2017
    Geopolitical issues took center stage last week as stocks fell again and Treasury bond yields dropped to their lowest level in 2017, as tensions surrounding North Korea and with Russia over the U.S. attack in Syria had market participants worried about the impact of the Trump administration’s domestic agenda.
  • Stocks Pull Back on Trump Administration Policy Concerns
    March 27, 2017
    Last week was highlighted by the Republicans’ failure to repeal and replace the Affordable Care Act (ACA). The policy setback was not well received by stocks, as the U.S. markets suffered both its worst day and week in 2017.
  • Fed Takes a Dovish Tone While Raising Rates
    March 20, 2017
    As expected, the Federal Reserve (Fed) raised the Federal Funds rate by 25 basis points (bps) last week. The increase came with a dovish tone regarding the pace of future increases, and sent risk markets soaring and treasury yields lower following the announcement.
  • The Value Trap
    February 21, 2017
    In this short trading week, I will be watching to see if we get any more information on the Federal Reserve’s (Fed) current thinking when they release the January meeting minutes this Wednesday.
  • Yellen and Inflation Highlight the Week Ahead
    February 14, 2017
    U.S. stocks reached new highs last week amid the continued slow process of cabinet appointments in Washington and the heightened noise associated with the new administration.
  • What is the Consensus Market View?
    February 6, 2017
    Last week was fairly uneventful from a market data perspective, as all eyes continued to be glued on Washington and the almost constant coverage of the Trump administration.
  • Central Banks Take Center Stage
    January 30, 2017
    Stocks made new highs last week as the Dow Jones Industrial Average broke above the 20,000 level on optimism for pro-growth policies from the Trump administration.
  • Economic Data Will Drive the Markets in the Week Ahead
    January 23, 2017
    The inauguration stole the headlines last week, and I expect it will be no different in the week ahead. With the anticipated repeal of The Affordable Care Act, cabinet appointments and the planned meetings with world leaders, including U.K., Canada and Mexico, the activities in Washington will continue to keep the media’s attention.
  • The Market and Economic Impact of the Trump Administration
    January 17, 2017
    This week has several key market-moving events, including the European Central Bank (ECB) meeting, potentially impactful dialog coming out of the World Economic Forum in Davos and key economic data in the both the U.S. and around the globe.
  • Busy Week with the Fed Announcement and U.S. Economic Data
    December 12, 2016
    This week will be very active, with the Federal Reserve (Fed) meeting for the final time in 2016 and significant economic data releases—all of which will be closely scrutinized given the stock market hitting all time highs.
  • Uncertainty for Stocks
    November 28, 2016
    Over the past few months, I have had a strong conviction that bond yields in the U.S. were going to rise due to both fundamental and technical factors.
  • Improving Economic Data
    November 21, 2016
    U.S. economic data continues to improve and last week’s strong reports were no exception, suggesting an uptick in fourth quarter growth and overall U.S. economic expansion.  
  • Fiscal Policy Uncertainty
    November 14, 2016
    Over the next few weeks the details and implications of the Trump Presidency will come into greater focus.
  • Tightening Labor Market
    November 7, 2016
    The economic highlight of last week was the October employment report. The report confirmed the continued tightening of the labor market.
  • Employment Continues to Improve
    October 10, 2016
    I decided to wait until after the Presidential debate to write this week’s post, as the potential for something totally unexpected and market-moving seemed very high.
  • Deutsche Bank Fears Grip Global Markets
    October 3, 2016
    It seemed like every day last week the top headline in the financial news was focused on the problems at Deutsche Bank and the potential implications for the global markets.
  • The Fed’s Dilemma
    September 19, 2016
    On Wednesday around 2:00 p.m. ET, we will find out the Federal Reserve’s (Fed) decision to either keep interest rates unchanged or increase them by 25 basis points.
  • Complacency Broken
    September 12, 2016
    For a few weeks now, I have been writing about the complacency in markets surrounding global economic conditions and monetary policy.
  • 3-month LIBOR Increases
    August 15, 2016
    Not much has changed in the last few weeks for the markets. Economic data is mixed in the U.S., and concerns still exist about global economic conditions.
  • U.S. Employment Trends Remain Favorable
    August 8, 2016
    The July payroll report on U.S. employment backed up the strong June report with another favorable sign for hiring. July non-farm payrolls rose by 255,000, with a net positive 18,000 positive revision. The unemployment rate held steady at 4.9%.
  • FOMC Expected to Keep Rates Unchanged
    July 25, 2016
    This week’s Federal Open Market Committee (FOMC) meeting will provide insight into the policy committee’s thinking about the post-Brexit economy.
  • U.S. Economic Data Supports the Market
    July 18, 2016
    Despite all of the political, geo-political and social tumult in the news recently, U.S. economic data has remained surprisingly robust.
  • Brexit Surprise
    June 27, 2016
    I had an interesting perspective this past week on the reaction to the Brexit vote as I was in Scotland with some of Penn Mutual Life’s top advisors.
  • Waiting for the Brexit Vote
    June 20, 2016
    After last week’s Federal Open Market Committee (FOMC) meeting, in which the Fed lowered its longer-term expectation for interest rates, we now await the upcoming vote in the U.K. on Brexit.
  • Markets and Uncertainty Are a Bad Combination
    June 13, 2016
    U.S. stocks traded off recent highs and bond yields fell again last week. After the disappointing employment report, 10-year Treasury yields have now fallen by 70 basis points this year.
  • Waiting for Janet Yellen
    May 31, 2016
    Janet Yellen kept trading desks fully staffed on Friday, before the holiday weekend.
  • Waiting for Janet Yellen
    May 23, 2016
    The Federal Reserve (Fed) minutes from the April meeting, released last week, surprised the market with the Fed’s insinuation that a June increase in interest rates may be warranted based on economic data.
  • Insights on the Market and Economy
    April 11, 2016
    Last week was relatively uneventful from a market perspective. The factors that have been driving the market recently continue to stay front and center for market participants.
  • Dovish Fed and Strong Employment
    April 4, 2016
    The highlights of last week were the dovish comments by Federal Reserve Chair Janet Yellen and the solid March employment report.
  • Economy, Employment and Inflation
    March 28, 2016
    As we approach the end of a volatile first quarter, the number one question I have been receiving recently is, “Where do markets and the economy go from here?
  • Fed Reduces Expectations for Rate Increases
    March 21, 2016
    As anticipated, the Federal Reserve (Fed) reduced expectations for future interest rate increases at its meeting last week. Risk markets rallied on the news. The Fed's dovish change in tone puts the market in an interesting dilemma.
  • U.S. Growth Revised Higher but Market Volatility Expected to Continue
    February 29, 2016
    Last week, fourth quarter GDP was revised higher from an initial 0.7% to 1.0%. I expect first quarter GDP to accelerate to 2.5%. Volatility should pick up this week, with some key economic data being released and more focus on China and a potential “Brexit.”
  • Is Inflation Good for Equities?
    February 22, 2016
    Last week saw a continuation of the uptick in the stock market that began Friday of the week before. The S&P 500 Index is up approximately 5% from its recent low and is no longer in a correction.
  • Was Friday’s Relief Rally Sustainable?
    February 16, 2016
    Last week was another difficult week for stocks despite Friday’s sharp rally. Global equities were under pressure for the first four days of the week, as energy prices continued to decline and Janet Yellen provided no indication that the Fed was changing its direction.
  • Market Prices or Economic Fundamentals?
    January 25, 2016
    After another volatile week for the financial markets, equities and energy prices ended up after starting the week by marking new lows for the year.
  • Stock Valuations and the Fed
    January 18, 2016
    Last week, I was asked to comment on an article in the Wall Street Journal that suggested investors have been accepting higher levels of risk in their investments in a quest for higher returns. The article held that this means many assets are overpriced, and the Fed’s actions in raising interest rates will cause those prices to fall.
  • 2016 Off to a Shaky Start
    January 11, 2016
    The first few trading days of 2016 have seen U.S. equities put in their worst performance to start a year ever and their worst week since 2011.
  • 2015 Lessons Learned: 3 Takeaways for Investors
    January 4, 2016
    Remarkably, despite numerous periods of extreme volatility across financial markets during 2015, the S&P 500 and 10-year Treasury yields will end the year almost exactly where they started.

2015 Archives


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