Weekly Market Commentary

July 22, 2014

After a dismal start to the month, municipal bonds have been sailing on U.S. Treasury bond coattails as investors look for safe harbors from world conflicts.  Widespread concerns with Puerto Rico credits weakened the market as a whole in July.

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July 15, 2014

Investor concerns over the plunging value of Puerto Rico paper led to the first withdrawals from high yield municipal bond mutual funds in 24 weeks.  A total of $718 million, roughly the equivalent of the last 5 weeks of net inflows, was redeemed in the week ended July 9, and this was mainly attributed to the latest round of credit downgrades.

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July 08, 2014

Historically, the days leading up to the July 4th holiday are slow and uneventful as trading desks are lightly staffed and attentions drift toward barbecue and beach plans. Not so last week. In response to Puerto Rico’s new debt restructuring law, large mutual and hedge funds began a sell-off which caused the prices of Commonwealth and public corporation bonds to plummet.

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July 01, 2014

The second quarter of the year ended quietly on Monday and trading activity is winding down ahead of the July 4th break. The S&P 500 stock index and the Nasdaq composite index recorded a sixth straight quarter of gains on June 30.

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June 24, 2014

In sharp contrast to U.S. Treasuries and corporate bonds, municipal bond yields have held steady for nearly two weeks as investors laden with cash elbow each other for access to tax-exempt paper in the primary and secondary markets.

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June 17, 2014

The financial markets keep finding good reason to cheer despite the turmoil in Iraq and Ukraine, disappointing retail, consumer, jobless and housing data, and the cut in the U.S. growth forecast by the International Monetary Fund. The reason is low interest rates.

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