Investors may be adjusting to the expectation of fewer rate cuts from the U.S. Federal Reserve, but James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management, believes that 2024 may see no rate cuts at all. In an interview with Jonathan Ferro and Lisa Abramowicz, he told Bloomberg Surveillance “I just think that there’s more inertia to inflation in a post-COVID economy than the Fed gives credit for.”

In the short term, economic growth, a healthy labor market, and above-target inflation aren’t motivating the Fed to cut rates. Over the longer term, “I just don’t think we’re in a 2% inflation world anymore,” Camp said. And it’s not just about 2024: He believes that the Fed should acknowledge the possibility of managing a higher-inflation economy for the next decade.

Idiosyncratic risk is one of the most appealing aspects of the market right now for Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management. In his appearance on MSNBC's Squawk Box Europe, he explained that investors have opportunities to lean into what works and lean out of what doesn’t.

Watch the full video here.

Wall Street is optimistic about 2024, but risks remain on the horizon, including potential disappointment surrounding interest rates.

“I just think there’s still going to be challenges with the market perhaps being ahead of where the Fed is,” Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management told the Wall Street Journal. “And that’s OK, because volatility presents opportunities.”

Read the Journal’s front-page article here (subscription required).

The case for owning BB-rated bonds has never been stronger, James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management, told Bloomberg Television.

“Since 2009, defaults have been almost non-existent in that space,” he said. BB- and BBB-rated bonds – “to us, the sweet spot of yield in credit” – together “encapsulate roughly half the investment-grade market, roughly half the high-yield market ... and if you look at a 6% yield relative to the equity risk premium and relative to most folks’ investment policy or investment objectives, that’s hitting a lot of marks. We think that’s going to be, especially for balanced investors, a very good entry point.”

Watch Camp’s interview here for his additional thoughts on the likely path of the yield of the 10-year U.S. Treasury note. A separate Bloomberg article also quoted Camp on the development that has been “unambiguously good for bonds” during “an extraordinary couple of months for the bond market.” Read that article here. (Subscription required.)

What can investors expect in 2024?

"Where people have been spending money is going to change," Matt Orton, CFA, Chief Market Strategist for Raymond James Investment Management, said on Fox’s Mornings with Maria. Orton said many parts of the economy are starting to work again, which is why he recommends leaning into quality and away from businesses where consumers might not want to spend money.

Watch his interview here.

After a year when seven mega-cap tech stocks dominated the S&P 500 Index, select small caps and emerging-market equities now could be poised to benefit from a falling dollar and lower interest rates.

“You probably, hopefully, will not have the same sort of roller coaster of emotions that we have had going forward,” Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management told the Wall Street Journal. “We have moved to a little bit of a more normalized market environment where some of the stuff that hasn’t worked for a long time finally starts to work again.”

Read the Journal’s front-page article here (subscription required).

How can investors adapt to U.S. Federal Reserve decisions in a market that tends to get ahead of itself?

"Waiting for the market to come to you" has been a winning strategy over the past year says Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management.

Watch his interview with CNBC's Power Lunch.

The timing is still very uncertain on future rate cuts from the U.S. Federal Reserve, but James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management, does not expect the Fed to reduce interest rates in the first quarter of 2024.

Read more in S&P Global Market Intelligence.

"We see the beginnings of recession actually hitting in the second quarter and we expect the Fed to cut (interest rates) at the back half of the year," said James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management. Read his full remarks in Reuters.

“We know one thing about bonds,” says James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management. “At peak Fed — and this goes back to the five tightening cycles that I’ve lived through — fixed income instruments outperform cash, unambiguously, 100% of the time.”.

Watch his conversation with Becky Quick on CNBC’s Squawk Box discussing what the slowing rally in Treasuries means for fixed-income investors.

Even with a pause in rate hikes, Federal Reserve Chair Jerome Powell’s statements on current economic conditions and his views on fiscal deficits will have significant short- and long-term impacts on markets, according to James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management.

Read the full article at CNBC.com (subscription required).

Leaning into quality is the playbook for Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management. His interview with CNBC TV-18 discussed how markets are realizing that the U.S. Federal Reserve is serious about “higher for longer” interest rates and why investors should prepare for an environment where quality investments can meaningfully outperform.

The full interview with CNBC TV-18 has more of his thoughts.

With long-term interest rates rising, the Dow Jones Industrial Average experienced its first three-week decline since February. Matt Orton, CFA, Chief Market Strategist for Raymond James Investment Management, told Nikkei Asia that rising rates have worsened investor sentiment.

Read the full coverage here (Japanese language).

The U.S. Federal Reserve is keeping its foot on the brake, and interest rates will remain higher for longer. Student loan payments have resumed, and U.S. consumers are expected to be pinched going into the holiday season.

However, it may be time for investors to start selectively looking for opportunities in the market. On Fox Business News, Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told Maria Bartiromo that he recommends looking at profitable companies with high-quality balance sheets and free cash flows. (No link available.)

Even though real rates are finally reflecting the true cost of capital, profitable companies are generating free cash flows that make them attractive to investors.

"It's been a long time since I've been willing to buy a dip in the U.S. market, but I think we're finally getting to that point," said Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management.

Watch his interview with CNBC TV-18 to hear his thoughts on the markets.

“Lean into quality,” Raymond James Investment Management Chief Market Strategist Matt Orton, CFA, told CNBC. “Profitability and strong balance sheets” are attributes of quality that many companies in the healthcare and energy sectors now provide. He also noted that companies in the industrials sector are benefitting from trends like the reshoring of manufacturing and increased capital expenditures by companies across many sectors.

Watch the interview to learn more.

A global fund manager survey may show that investors are fleeing China, but Matt Orton, Chief Strategist at Raymond James Investment Management, sees opportunities in other emerging markets. In an interview with MarketWatch, he identified India, Taiwan, and South Korea as countries that have bright prospects. “Where investors are willing to do a little bit of homework, there’s definitely opportunities,” Orton said.

The full MarketWatch article goes into more detail.

India is winning what China has lost now that more companies are reorganizing their supply chains, according to Matt Orton, Chief Strategist at Raymond James Investment Management. In his appearance on CNBC TV-18, he also discussed how increased energy costs are being driven by supply constraints and demand that has been stronger than investors are willing to acknowledge. Orton says that he'd be ready to put money to work if markets experienced a healthy pullback, but as always, quality counts.

Watch the interview and learn more.

It’s still possible that the U.S. Federal Reserve (Fed) will raise rates in November. Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told Street Signs Asia that the Fed has maintained a “dogmatic focus” on getting inflation to its targeted 2% level.

Orton said real interest rates reflect the actual cost of capital, and they continue to move higher, making it more important than ever to study company balance sheets and to lean into quality investments. “It’s unlikely that we're going to see the Fed take its foot off the brake," he said.

Instead of a “hard landing” scenario, Orton expects a series of rolling recessions where individual industries cycle through their own downturns. This, he said, could provide investors with frequent opportunities for tactical reallocation.

In Orton’s opinion, it’s “highly unlikely” that every sector will experience a simultaneous recession and everything trades down together. Although the Fed must thread a very fine needle, he said, "I do think it can land the plane where the data has been coming in."

(No link available.)

Can the U.S. Federal Reserve (Fed) declare victory against inflation? Some of the data has been encouraging, says Matt Orton, Chief Strategist at Raymond James Investment Management, but it’s too early to say that the fight is over. Orton expects interest rates to remain higher for longer, even if the Fed pauses rate increases in September.

Watch his full interview with CNBC TV-18 here.

Investors may be feeling positive for the first time in a while, but a key test will be whether they remain calm through a market correction. Matt Orton, Chief Strategist at Raymond James Investment Management, expects some consolidation ahead, warning clients not to chase the market higher.

Watch his full interview on the TD Ameritrade network.

“Build versus buy” is a well-known decision framework for business strategies, and Raymond James investment Management is considering both approaches to developing new offerings. Private credit, secondary private equity, real estate, and infrastructure are some of the possibilities, in addition to actively managed exchange-traded funds.

Bob Kendall, President of Raymond James Investment Management, shares his thoughts for expansion in CityWire (subscription required).

The U.S. Federal Reserve has implemented some of the most aggressive interest rate hikes in history, but inflation remains a major concern. Todd Thompson, CFA, managing director and portfolio co-manager at Reams Asset Management, discussed the central bank’s likely responses with S&P Global Market Intelligence.

Read the article to learn more.

Earnings season has brought encouraging news from money center banks and some of the larger regional banks, with an inflection in the flight of deposits, improving deal flow, and continued signs of a healthy consumer, said Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told CNBC’s Squawk Box Europe. “The consumer has continued to surprise to the upside, and I think that has provided a lot of support not only for the economy as a whole but for corporate earnings,” he said. Once more regional banks start to report, it will be key to watch what’s going on with commercial real estate losses. Watch the full 10-minute interview here.

Inflation may be moving in the right direction, but Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told CNBC TV-18 that it's too early for the Fed to declare "mission accomplished."

Watch the interview and learn more.

“Coming out of zero-COVID,” the performance of China, the world’s second-largest economy, has “definitely been disappointing,” but still “good enough that it hasn’t derailed the global growth story,” Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told the Wall Street Journal. A lot of semiconductor companies that have driven large-cap stocks into the artificial intelligence growth market “have high revenue exposure to China,” Orton said. Read the article here. (Subscription required.)

David R. Vaughn, CFA, Chief Investment Officer of Non-U.S. and Global Strategies at ClariVest, believes that longer-term growth potential and a significant valuation gap are reasons why investors with longer time horizons should consider emerging markets. Read more in this Forbes article.

There are several factors to consider when determining how fixed-income markets will behave in the second half of the year. James Camp, CFA, Managing Director of Fixed Income and Strategic Income at Eagle Asset Management, discussed them with Tom Keene and Lisa Abramowicz on Bloomberg Surveillance.

Click here for Camp’s remarks on tight credit conditions, banks under stress, and how “the Fed’s work is really just starting.” (segment begins at 1:17:00).

After correctly predicting that the June meeting of the Federal Open Market Committee would result in a pause for interest rate hikes, Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told CNBCTV-18 that investors need to take the U.S. Federal Reserve at its word when it says that rate hikes may not be over. Watch the full video.

Although the U.S. may be just shy of entering a new bull market, market gains continue to be supported by a small number of companies. At the start of June, the S&P 500's information technology and communications services sectors had each gained more than 34%, but only five of the S&P 500’s 11 sectors are up for the year. Other sectors may catch up. In the meantime, Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told the Wall Street Journal that “I think you want to be leaning into higher-quality, low volatility names.” Read the full story here. (Subscription required.)

Once the drama of the debt ceiling is over, investors and central banks will be able to re-focus on economic data. Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told CNBC-TV18 that over the next six months, a strong economic outlook means that the U.S. Federal Reserve will have a difficult time cutting interest rates. “Inflation’s certainly coming down,” he said, “but there’s persistent pressure.” Click here to watch the full interview.

Asset managers looking to grow need to focus on a few key areas, including long-term decision-making, clients’ needs, cultural alignment, and broader distribution, Bob Kendall, President of Raymond James Investment Management, told Ignites. Fund companies can build internal distribution teams that target clients by segment, but doing so is expensive, he said. They can also work with third-party distributors, or they can “look to be acquired by a larger platform that will respect their independence while providing efficiencies of scale,” Kendall said. “Managers can make money in this new paradigm of ever-compressing fees, but it’s easier to do so with preexisting back-office functions, versus having to create those functions individually.”
Click here for the full article (subscription required).

How are professional investors reacting to fears of recession and expectations that the Fed may end its rate tightening cycle? Todd Thompson, CFA, managing director and portfolio co-manager at Reams Asset Management, told Reuters that outsized moves in Treasuries and debt ceiling uncertainty could make a case for maintaining neutral-duration portfolio strategies. Read more in the article.

“The economy has held up much better than a lot of folks have feared, and the consumer wallet is still open,” Matt Orton, CFA, Chief Market Strategist at Raymond James Investment Management, told CNBC’s Closing Bell: Overtime. Consumer spending and company earnings suggest that worst-case scenarios are unlikely, but “the Fed is going to be the big question mark.” Click here for more of his thoughts on company earnings.

Although bond yields are changing, it might not be a good time to abandon effective investment approaches. From a credit selection perspective, "we still think it makes sense to focus on strong companies and defensive sectors, whether in investment grade or high yield," Bishop Jordan, senior credit analyst at Eagle Asset Management, told Reuters. Read more in the full article.

What’s coming next from the U.S. Federal Reserve: A pause, a pivot, or preparation for another hike? Todd Thompson, CFA, Managing Director and Portfolio Co-Manager at Reams Asset Management, discussed the possibilities with Bloomberg. “Our thesis in credit is that you want to be on the long side and we do expect the Fed to pivot and ease,” Thompson said.
Read the full story here.