Weekly Update: Feds Keep Firing, Locals Keep Hiring…and Issuers Keep Growing

Insights
Written By Alicia Purden

Feds keep firing, Locals keep hiring…and Issuers keep growing...

Muni Insights: This is your wakeup call!

  • Jobs: Last 12 months…Fed jobs -74k, state and local jobs +140k. Last 24 months… Fed jobs -10k, state and local +310k… do you follow what’s happening?

  • Muni Supply: $415B ytd, >6500 issuers = the candy store is open!

  • Credit: Headline risk and real risk, if issuers struggling now (after the past 5 years) that is a problem…good news is with a clear/custom/original thought your portfolio can be ultra safe. As always, we are happy to discuss the how and why in detail.

  • Value: Aplenty! battle and dig a bit more in the corners, but its there for the taking now

Macro Update

  • Jobs: Growth numbers slowing + a June revised contraction = bond rally! 75bps of cuts priced in by year end, productivity/ULC also bond-friendly

  • Equity (pts/wk/ytd): Dow -144pts, -0.32%/+6.71%; S&P +21pts, +0.34%/+10.20%; Nasdaq +245pts, +1.01%/+12.37% (pays to have dinner at the WH!)

  • Rates: UST and Tax-Free go bull flattener with rates 10 lower up front and 15 lower longer–– after nothing but pundit panic all week long

  • Data: PPI/CPI Wed/Thurs, back in traditional order this week

  • Corp Credit: Price to near perfection with IG +77 OAS and HY +272 OAS

Alicia Purden
Next

Weekly Update: Powell Set the Tone, but It’s Munis that will Drive Returns