Why the Yield Curve Inversion Might Not Spell Doom for U.S. Stocks in 2023
Even with another part of the U.S. Treasury yield curve flashing recession signals, U.S. stocks aren't necessarily doomed to fall in 2023, according to James Paulsen, chief investment strategist at the Leuthold Group.
A usually reliable recession indicator appeared about a month ago, when the 10-year Treasury yield fell below the 3-month bill rate. As of last Friday, the 10-year yield was at 3.55%, while the 3-month rate was close to 4.34%.
In the meantime, the above chart shows the S&P 500's total return as mostly positive after the first month of a 10-year/3-month yield curve inversion since 1965. To be sure, the average 1-year and 2-year return after such inversion was 6% and 13.9%, respectively.
"That is, overall, while yield-curve inversions have customarily unleashed havoc on the economy, job creation, and even profits, they are not nearly as bad for the stock market as commonly advertised," Paulsen wrote.
Source: Leuthold Group, MarketWatch
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Giovanni Ayala : @Ripper1986@SpyderCall
HereForTheTrades : FED overnight repurchase
70784737 : Market to 0 soon yall tripping trynna get other people to hold the bag // unethical
FearGreed : Interesting. I suppose it had something to do with how the spx performed just before the inversion, ie it might have already been priced in and subsequent performance depended on how the economic downturn unfolded.
StlCtyPreach 70784737 :
I don't think spreading FUD is the best way to handle your frustration with the markets. Perhaps you should better utilize this down time by increasing your knowledge thru some of the great FREE learning programs they offer here on moomoo!
and Happy Trading 
!
Good Luck
70784737 StlCtyPreach : “FUD” lmaooo we are in a recession
StlCtyPreach 70784737 : There's nothing wrong with talking about a recession, but that doesn't mean all stocks are going to "0"...
You just need to be patient.
Sir Gregory L : I believe inflation the stock market for the most part basil analyst and what I feel I know about next month I think it'd be sharp numbers at the end of first quarter of 2023