Last week brought epic rallies in both the stock and bond markets. We think the stock market’s correction is over and that the S&P 500 is back on track to end the year at 4600. All 11 sectors gained ground last week, many enjoying their best week in nearly a year.
As for the bond market rally that carried the 10-year Treasury bond yield down to a more comfortable distance from 5.00%, the wave of buying had multiple drivers. Nevertheless, beware of the Bond Vigilantes.