LSA Connect

Weekly Economic Update

Posted on April 10, 2017 by LSAConnect

Economic Update 4-10-2017

Economic reports for the week came in mixed, with slightly weaker ISM manufacturing and non-manufacturing data, although both remained strongly expansionary. While the ADP employment report was quite strong, the government nonfarm payrolls report was far less so, while the unemployment rate declined.

Equity markets were mixed with flat to lower results in the U.S., with large-caps holding up much better than small, and better results from emerging markets than developed. Bonds gained a bit with interest rates ticking downward a bit, but foreign assets of all kinds held back by a stronger dollar. Commodities edged upward along with higher prices for crude oil.

Posted in Economic News | Tagged bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, Economic, economic data, economic growth, Economic Update, Emerging Markets, Employment, Europe, Eurozone, Fed, Federal Reserve, fixed income, FOMC, GDP, Government, Home Sales, Inflation, interest rate, interest rates, Janet Yellen, Japan, Jobless Claims, LSA, MSCI Europe, oil prices, Portfolio, Q/E, Real Estate, Retail Sales, Russia, S&P 500, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

Weekly Economic Update

Posted on April 4, 2017 by LSAConnect

Economic Update 4-04-2017

Economic data for the week was highlighted by stronger manufacturing and housing results, an improvement in consumer confidence to a multi-decade high, while Q4 GDP was revised slightly higher than in earlier releases.

Equity markets in the U.S. gained, developed markets ended flattish on net and emerging markets lost ground. The majority of bond indexes were flattish, with very little interest rate movement, while commodity indexes gained generally with a bounce higher in crude oil prices.

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Weekly Economic Update

Posted on March 27, 2017 by LSAConnect

Economic Update 3-27-2017

In a lighter week for economic data, durable goods and housing data were mixed, while jobless claims rose due to winter weather in parts of the country.

U.S. stocks declined in line with political disappointments surrounding health care reform, while foreign equities were helped somewhat by a weaker dollar. Bonds fared well as flows moved away from risk and interest rates declined, with foreign outperforming domestic. Commodities declined generally with weakness in crude oil prices due to supply concerns.

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Weekly Economic Update

Posted on March 20, 2017 by LSAConnect

Economic Update 3-20-2017

It was a busy week for economic data, as the FOMC raised interest rates by a quarter-percent, manufacturing data came in decently, inflation ticked a bit higher, and housing results and labor data came in stronger.

U.S. equity markets ticked modestly higher on the week, but were outpaced by foreign stocks, and especially so by emerging markets. Bonds also experienced a decent week, as interest rates declined somewhat. Commodity prices rose with strength in metals, a weaker dollar and slight recovery in crude oil.

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Fed Note

Posted on March 15, 2017 by LSAConnect

Fed Note:

It was a fairly dramatic turn of events over the prior few weeks with the probabilities of a Fed hike in March moving from about one-in-three or lower to almost guaranteed by the time we heard higher rate-focused comments from several FOMC members—something they often do strategically to help shape expectations. Those expectations were realized this morning with a rate hike of 0.25%, bringing the new Fed funds rate to a range of 0.75-1.00%.

The formal statement acknowledged that economic activity overall has continued to expand at a moderate pace. This is coupled with a strengthening labor market, moderately higher household spending, and increased inflation. The committee’s economic projections, done roughly quarterly, showed little change on net in the areas of GDP growth, unemployment and inflation, although the ‘dot plot’ for upcoming expected interest rate ticked higher, on course for about three rate hikes in 2017 (as already expected).

The change in tune in recent weeks was driven by stronger economic data, firming inflation as well as a realization that several key components of the Fed’s mandate have been reached, including inflation within target and labor market strength. The dashboard of Fed mandates shows this:

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Posted in Economic News | Tagged bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, Economic, economic growth, Economic Update, Emerging Markets, Employment, Europe, Eurozone, Fed, Federal Reserve, fixed income, FOMC, GDP, Government, Home Sales, Inflation, interest rate, interest rates, Janet Yellen, Jobless Claims, LSA, MSCI Europe, Portfolio, Q/E, Real Estate, Russia, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

Weekly Economic Update

Posted on March 6, 2017 by LSAConnect

Economic Update 3-06-2017

Economic data for the week was led by strength in both manufacturing and non-manufacturing indexes, strong consumer confidence and jobless claims, and mixed housing results.

Equity markets gained in the U.S. and abroad in foreign markets, while emerging markets fell back for the week. Bonds lost ground as interest rates rose in response to Fed rate hike comments. Commodities lost ground, mostly due to oil and precious metals.

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Posted in Uncategorized | Tagged bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, Economic, economic data, economic growth, Economic Update, Emerging Markets, Employment, Europe, Eurozone, Fed, Federal Reserve, fixed income, FOMC, GDP, Government, Home Sales, Inflation, interest rate, interest rates, Janet Yellen, Japan, Jobless Claims, LSA, MSCI Europe, oil prices, Portfolio, Q/E, Real Estate, Retail Sales, S&P 500, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

LSA Variable Annuity Revisions

Posted on March 3, 2017 by LSAConnect

LSA will be making revisions to all variable annuity platforms over the next two weeks. We will be releasing the revisions in three waves. The first wave has already been posted and will include: (Private Client Tax Efficient, JNL, JNL Elite Access, Jefferson National, Sammons, Voya Select Advantage). The revision allocation sheets have already been posted to the website and we will be posting the revision explanations and videos over the weekend with a targeted trade date of March 6^th. Below, please find the next two waves of model changes to be released.

Investment Rationale: LSA will be recommending changes to all the VA model portfolios over the next two weeks to address some under-performing sub-accounts that have been placed on a watch-list and to continue with our movement of reducing risk or correlations in the portfolios. As market highs continue to be reached LSA would like to take the opportunity to realize some gains, reduce risk and square up the model portfolios. The IPC will be recommending funds in the models with the attempt to reduce risk and to provide solid downside protection. Although the IPC continues to believe that a recession is not eminent in 2017, we do believe that the probability of a recession in the next couple of years has increased greatly over the last eight months. The March 2017 model changes are not targeting big shifts in asset class exposures. We believe the portfolios handled well in 2016, but we will continue to explore the use of alternatives. The alternatives will be used to reduce correlations, the potential for emerging market equities to go after attractive valuations, and commodities as ways to combat inflation. Continue reading →

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Weekly Economic Update

Posted on February 27, 2017 by LSAConnect

Economic Update 2-27-2017

On a shortened holiday week, and a light one for economic data, housing results were generally strong, and jobless claims continued to run at low levels.

Global equity markets were generally higher on the week, with continued improved sentiment, while U.S. bond markets rallied upon lower interest rates, as did foreign bond markets. Commodities ended flat, with little change in crude oil prices.

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Posted in Economic News | Tagged bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, economic data, economic growth, Economic Update, Emerging Markets, Employment, Europe, Eurozone, Fed, Federal Reserve, FOMC, GDP, Government, Home Sales, interest rate, interest rates, Janet Yellen, Japan, Jobless Claims, MSCI Europe, oil prices, Portfolio, Q/E, Real Estate, Retail Sales, Russia, S&P 500, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

Weekly Economic Update

Posted on February 21, 2017 by LSAConnect

Economic Update 2-21-2017

In a busy week for economic releases, several manufacturing indexes shined with strong results, inflation came in stronger than in recent months, and housing numbers were a bit mixed.

U.S. equity markets again showed strong gains, although foreign stocks also came in positive. Bonds were flattish with little changes in interest rates, although high yield bonds continued their momentum. Commodities fell on the week, although crude oil prices were little changed.

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Posted in Economic News | Tagged 1st Quarter GDP, bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, Economic, economic data, economic growth, Economic Update, Emerging Markets, Employment, Europe, Eurozone, Federal Reserve, fixed income, FOMC, GDP, Government, Home Sales, Inflation, interest rate, interest rates, Janet Yellen, Japan, Jobless Claims, MSCI Europe, oil prices, Portfolio, Q/E, Real Estate, Retail Sales, Russia, S&P 500, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

Weekly Economic Update

Posted on February 13, 2017 by LSAConnect

Economic Update 2-13-2017

In a very light week for economic data, import prices were relatively contained, sentiment fell a bit, labor metrics JOLTs and jobless claims continued to show strength.

Equity markets gained during the week, in the U.S. and even more so abroad. Bonds also fared well, with interest rates ticking down. Commodity prices rose a bit, despite a stronger dollar, with oil ending flattish on net.

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Posted in Economic News | Tagged bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, economic data, Economic Update, Employment, Europe, Eurozone, Fed, Federal Reserve, FOMC, GDP, Government, Home Sales, Inflation, interest rate, interest rates, Janet Yellen, Japan, Jobless Claims, LSA, MSCI Europe, oil prices, Portfolio, Q/E, Real Estate, Retail Sales, Russia, S&P 500, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

Weekly Economic Update

Posted on February 6, 2017 by LSAConnect

Economic Update 2-06-2017

Economic data for the week was highlighted by a Fed meeting marked by no action, stronger ISM manufacturing data and employment, with middling non-manufacturing, housing and consumer confidence data.

Equity markets experienced a mixed, flattish week on net, with emerging markets leading the way with stronger returns. U.S. bonds were generally flat, while foreign bonds and commodities gained in line with a weaker dollar during the week.

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Posted in Economic News | Tagged bps, China, Commodities, CPI, Crude oil, crude oil prices, DJIA, ECB, economic data, economic growth, Economic Update, Emerging Markets, Employment, Europe, Eurozone, Fed, Federal Reserve, fixed income, FOMC, GDP, Government, Home Sales, Inflation, interest rate, interest rates, Janet Yellen, Japan, Jobless Claims, LSA, MSCI Europe, oil prices, Portfolio, Q/E, Real Estate, Retail Sales, Russia, S&P 500, S&P500, unemployment rate, Update, Yahoo! | Leave a comment

Fed Note

Posted on February 2, 2017 by LSAConnect

Fed Note

It wasn’t expected for the Fed to take any action at their meeting concluding today, so there were no disappointments (i.e. nothing happened from an interest rate standpoint, by unanimous vote).

Their formal statement reflected their views that the economy is continuing to expand at a ‘moderate’ pace, coupled with ‘solid’ labor growth. Overall, the language wasn’t altered much from December, but improvement was noted in consumer and business sentiment as well as higher inflation, despite continued low inflation expectations.

In looking at the dashboard of Fed mandates, the numbers similarly haven’t largely changed from the end of 2016, but we could be seeing more of a gradual evolution in a few areas, that may or may not be jump-started by stronger post-election business sentiment and/or legislative/fiscal action. The baseline case appears to be 2-3 rate hikes in 2017, perhaps spread out to about one per quarter or so, but that is certainly subject to change based on data releases and other conditions.

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LSA Connect

Weekly Economic Update

Weekly Economic Update

Weekly Economic Update

Weekly Economic Update

Fed Note

Weekly Economic Update

LSA Variable Annuity Revisions

Weekly Economic Update

Weekly Economic Update

Weekly Economic Update

Weekly Economic Update

Fed Note

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