But if I knew how to manage my portfolio safer and smarter than most hedge fund managers, I could realistically grow my wealth.
After a stormy week, bonds have a lot of data to navigate
After the FOMC meeting, the bond market got a little bit of stability last week. Mortgage REITs and trading desks are generally smarting after the bloodbath in bonds, which sent the ten-year yield up over 100 basis points in under two months.
Next week is a short week with the 4th of July holiday, but the employment report on Friday looms large.
As we swing into the end of the quarter, companies that will miss their earnings numbers will start to pre-announce.
Economic data this week
Monday, July 1st
Tuesday, July 2nd
Wednesday, July 3rd
Thursday, July 4th
Friday, July 5th
Implications for mortgage REITs
For REITs like American Capital (AGNC) and Annaly (NLY) to rally they need signs of economic weakness that would theoretically put the Fed on hold as far as ending quantitative easing (or QE). Realistically, the only reports that would cause this would be labor market related. For them, the only report that matters is Friday’s jobs report.
Implications for home builders
Home builders, like KB Home (KBH), Toll Brothers (TOL), and Lennar (SPF), will certainly focus on the IBD/TIPP economic optimism index, as consumer confidence drives new home sales even more than interest rates. The Challenger Job Cuts report and the jobs report on Friday will be the highlights of the week.
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