DoubleLine’s Jeffrey Mayberry and Samuel Lau shut the door on a rough first half to the year and begin the second half with coverage of the short, pretty crazy week of July 5-8. Following last week’s signals pointing toward recession, this week included a strong run by the S&P 500 and offered data that could be pointing to at least a little growth (1:59). In fixed income (3:03), the U.S. Treasury yield curve closed the week above the 3 handle across the board, but the 2s10s (two-year/10-year) inversion clocked in across all four days. Jeff and Sam wonder if Monday will bring the fifth consecutive day, a traditional barometer pointing toward recession, and if any analysts will change their tune on how long the inversion must last. Sam also says to be on the lookout for an inversion of the 3s10s (three-month/10-year), a very reliable herald of recession. Commodities’ big positive print on the year continued to fade (7:01).
Jeff and Sam note the stock market doesn’t seem to be following a recessionary narrative before moving into Macro Land (9:15), which delivered services PMI and labor data that could be read as bolstering or questioning a recession story. Next week brings the June CPI and an answer to whether peak inflation was hit in May. This episode was recorded after market close July 8, 2022.
Mr. Mayberry joined DoubleLine in 2009. He is a Portfolio Manager on DoubleLine’s strategic commodity strategy while working in portfolio management and trading for derivatives‐based and multi‐asset strategies. Mr. Mayberry is a Strategist on the Fixed Income Asset Allocation (FIAA) committee and a contributing member on our Global Asset Allocation and Macro committees. He also co-hosts DoubleLine’s weekly Monday Morning Minutes (Twitter @DLineMinutes, Minutes@Doubleline.com) podcast. Prior to DoubleLine, Mr. Mayberry was a Senior Vice President at TCW for nine years within the Mortgage Group, where he specialized in portfolio and fund monitoring and analytics. He holds a B.S. in Engineering from Harvey Mudd College and an M.S. in Financial Engineering from the Peter F. Drucker Graduate School of Management at Claremont Graduate University.
Mr. Lau joined DoubleLine in 2009. He is a Strategist on the Fixed Income Asset Allocation (FIAA) Committee and a contributing member on the Global Asset Allocation and Macro committees. Mr. Lau is a Portfolio Manager on DoubleLine’s strategic commodity strategy while working in portfolio management and trading for derivatives-based and multi-asset strategies, including DoubleLine's Shiller Enhanced CAPE®, Shiller Enhanced International CAPE®, Real Estate and Income, and Multi-Asset Trend strategies. He also co-hosts the Sherman Show (Twitter @ShermanShowPod, ShermanShow@Doubleline.com) and Monday Morning Minutes (Twitter @DLineMinutes, Minutes@Doubleline.com) podcasts. Prior to DoubleLine, Mr. Lau was a Vice President at TCW where he worked under Jeffrey Gundlach as a Research Analyst in the Mortgage Group. He holds a B.S. from the University of Wisconsin, Madison and an MBA from the Marshall School of Business at the University of Southern California.