Tuesday - May 20, 2025
The Dividend Cafe
The Dividend Cafe - The Bahnsen Group
4.9 • 572 Ratings
🗓️ 20 May 2025
⏱️ 9 minutes
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Summary
Dividend Cafe: Market Update and Economic Insights - May 20
In this episode of Dividend Cafe, host Brian Szytel discusses the current state of the markets on a quiet economic day. After a six-day positive streak, the S&P 500 saw a slight decline, along with the Dow and NASDAQ. Key economic indicators such as the 10-year yield, which closed at 4.48%, and the yield curve spread are examined. Sitel dives into impressive Q1 earnings growth, better-than-expected guidance, and the implications of policy and populist sentiment on markets. Additionally, he addresses the wealth divide exacerbated by rising asset values and the role of the Fed in market stability, emphasizing its significant impact on monetary policy and capital markets efficiency. Viewer questions about the relevance of Fed Futures and market speculation are also explored.
00:00 Introduction and Market Overview
01:10 Earnings and Economic Sentiment
02:33 Wealth Divide and Economic Disparity
04:37 Fed Futures and Monetary Policy
06:29 Conclusion and Viewer Engagement
Links mentioned in this episode: DividendCafe.com
Transcript
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| 0:00.0 | Welcome to the Dividend Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. |
| 0:10.0 | Welcome to Dividend Cafe. This is Tuesday, May the 20th, Brian Saitel with you here. |
| 0:18.0 | On a fairly rangebound day in markets. Not a lot going on the economic |
| 0:22.8 | calendar. It was fairly quiet. There was a few Fed governors and presidents that spoke, but nothing |
| 0:27.3 | worth reporting. So you just had a give-back day here after six positive days on the S&P 500. |
| 0:33.5 | But modestly so, the market was down. Dow was down 114 points, which was off the lows for the day. |
| 0:40.0 | SMP was down about 0.4%, as was the NASDAQ. |
| 0:43.7 | So again, rangebound, pretty quiet. |
| 0:45.3 | The 10-year yield was up two basis points on the day. |
| 0:47.7 | We closed at 448 on tens and 30s, which had very briefly popped above 5% after the credit rating downgrade over the weekend, |
| 0:58.3 | are back to 496. So they were in the high 480s throughout the day. So they're just bopping around |
| 1:04.0 | in the same sort of area. The yield curve, by the way, is fairly positive. You've got 100 basis |
| 1:08.9 | points between 2 and 30 year yield. So it's a 397 versus a 497 |
| 1:14.4 | essentially. So the short end is still inverted and you've got some work to be done there on Fed funds |
| 1:20.3 | to bring that back down. Speaking of which, I had a couple of comments in there today. One was just on |
| 1:24.5 | earnings now that we're basically 92% of the way through for Q1 |
| 1:28.1 | earnings. So we're ending up right at 14.2% on earnings growth for the quarter. That's better than |
| 1:34.0 | the 8% that was expected. So that's very good news. The question on it will just be whether the |
| 1:38.8 | volatility that we saw from trade and Liberation Day in April will flow through to earnings and then ultimately through |
| 1:45.2 | to employment when we get to Q2. So that's what we'll be watching in the meantime. It wasn't just |
| 1:50.4 | that the earnings for the first quarter were fairly, we're better than expected. A lot of companies |
| 1:54.1 | pulled guidance, but it was actually better than expected as well. So those are positive things. |
... |
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