DoubleLine Cross Asset Analyst Mark Kimbrough and Fixed Income Allocation Strategist Ryan Kimmel review a week ended Oct. 31 with just two sectors, tech and consumer discretionary, holding the S&P 500 above water, and risk sectors of fixed income – high yield, bank debt and emerging markets – showing gains with investment grade sectors lower as yields shifted higher across the curve.
On the macro front, the first meeting by U.S. President Trump in his second term with China President Xi, Ryan notes, “removed some of the tail risk of further trade-war escalation.” However, the week’s biggest market-moving event came out of Federal Reserve Chair Jerome Powell’s news conference Wednesday after the Federal Open Market Committee, as expected, cut the federal funds target rate 25 basis points. Powell’s flat advisory against assuming a further rate cut at the Dec. 10 FOMC meeting lowered market-priced probabilities for such a cut from as high as 95% to 60% and pushing yields up along the curve.
Looking ahead to Nov. 3-7, given the idling of government statistical mills during the shutdown, Mark and Ryan have private-sector data releases for October on their menu: ISM Manufacturing (Monday); ADP private employment and ISM Services (Wednesday); University of Michigan consumer expectations survey (Friday).
Subscribe to the Minutes podcast on:
iTunes | Spotify
Follow us on X
Comments and suggestions should be directed to Minutes@doubleline.com
Mr. Kimbrough joined DoubleLine in 2012, where he worked primarily on Agency Mortgage Backed Securities and the Fixed Income Asset Allocation process as a member of the Risk Analyst team. He transitioned to his current role in 2019 where he serves as an Analyst on the Macro Asset Allocation team. Prior to DoubleLine, Mr. Kimbrough was at Western Asset Management working on systems monitoring and development within the Risk Department. He holds a BS in Business Administration with a concentration in Real Estate Finance and a minor in Economics from the University of Southern California. Mr. Kimbrough is a CFA® charterholder.
Mr. Kimmel joined DoubleLine in 2013. He is an Analyst on the Macro Asset Allocation team. Mr. Kimmel is also a Strategist on the Fixed Income Asset Allocation (FIAA) Committee and a contributing member on our Global Asset Allocation Committee. Prior to DoubleLine, Mr. Kimmel was a Proprietary Trader at Gelber Group, trading currencies for the Foreign Currency Group. Prior to that, he was an Investment Banking Analyst in Morgan Stanley’s Mergers and Acquisitions Group. Mr. Kimmel holds a B.A. in Business Economics from the University of California, Los Angeles (UCLA), and holds an MBA from the Anderson School of Management at UCLA.
