The gloominess from September and the really bad seasonals were all changed on a dime because of the realization that fiscal talks are on and we may get a fiscal stimulus plan. It may get delayed but the market is telling us that it’s happening.
The Chicago PMI came in the best since December of 2018. The ADP Payroll report came in better than expected. We could get a really nice Jobs Report coming Friday, October 2, 2020.
We have moved out of September and are in a new cycle and that is the buy signal, not the noise coming from Washington about the upcoming Presidential election.
Phil Camporeale, JPMorgan Asset Management managing director of multi-asset solutions, told Bloomberg this morning, “There are two sides to the multi-asset portfolio: the 60 and the 40. On the 60 side which is the equity side what we’re doing is we’re diversifying our overweights. This is not just a U.S. exceptionalist story anymore. We believe this is a new global cycle and that the world will emerge from the pandemic
On the 40 side, it’s a credit story. 10-year Treasury notes are not moving. 10-year Treasury notes are not really going to protect the equity allocation. We believe credit is a great place to be both from the investment-grade side, the securitized side which is non-corporate credit, and high yield. Those three things make up 75 percent of our fixed-income… so we are making a big bet on credit because government bonds aren’t moving.”
Phil Camporeale, JPMorgan Asset Management managing director of multi-asset solutions, says JPMorgan is making a big bet on credit because 10-year Treasuries are not moving. He speaks during an interview with Bloomberg’s Jonathan Ferro, Tom Keene and Lisa Abramowicz on “Bloomberg Surveillance.”