There will most certainly be challenges, but there are also some tailwinds from a strong job market, still resilient businesses, and the likelihood that inflation will soon start to slow
CHARLOTTE, N.C., July 12, 2022 (GLOBE NEWSWIRE) — LPL Financial LLC (Nasdaq: LPLA) today announced that the firm’s “Midyear Outlook 2022” is now available in an interactive digital version and as a downloadable PDF. The report contains investment insights and market guidance from LPL Financial’s Research team. LPL Financial currently has approximately $1 trillion in advisory and brokerage assets under management as of 3/31/2022, with $624 million of the total comprised of advisory assets.
Key insights and forecasts discussed in the Midyear Outlook 2022 report include:
Economy: Slow Growth. The domestic economy will continue to grow this year, albeit slower than expected six months ago. Other than the anomaly of a negative print in first quarter gross domestic product (GDP), the economy has sufficient momentum to offset the inflationary pressures.
Inflation: Cool Down. Inflation will most likely be significantly above the Fed’s long-run target of 2%. Inflation rates will likely cool throughout this year, but the cool down period will be long and slow. Some inflation pressures should subside as China adjusts its COVID-19 policy and supply chains improve.
Stocks: Strong Headwinds. Stocks will face a number of headwinds in the second half of the year, but the amount of turbulence will likely depend on the pace at which inflation falls. Volatility may persist, but an improved macroeconomic environment may set the stage for higher valuations, further earnings growth, and solid gains for stocks over the rest of the year.
Bonds: Value Proposition. Despite the historically poor start to the year, the value proposition for core bonds has actually improved recently. With the big jump in yields that has already taken place this year, we believe core bonds look as good as they have in quite some time.
“We know that making the right decision at the right time is key to finding a safe harbor in stormy weather,” said LPL Financial’s Senior Vice President of Research, Marc Zabicki. “The issues we are facing are significant: inflation is at its highest level in decades, central banks are working to unwind more than a decade of extraordinary monetary support to fight inflation, and Europe’s two largest countries are at war. The turbulence is real, but our research leads us to believe that there are effective ways to navigate these times successfully.”
About LPL Financial
LPL Financial (Nasdaq: LPLA) was founded on the principle that the firm should work for the advisor, and not the other way around. Today, LPL is a leader in the markets we serve,* supporting over 20,000 financial advisors, and approximately 1,000 institution-based investment programs and 500 independent RIA firms nationwide. We are steadfast in our commitment to the advisor-centered model and the belief that Americans deserve access to personalized guidance from a financial advisor. At LPL, independence means that advisors have the freedom they deserve to choose the business model, services, and technology resources that allow them to run their perfect practice. And they have the freedom to manage their client relationships, because they know their clients best. Simply put, we take care of our advisors, so they can take care of their clients.
*Top RIA custodian (Cerulli Associates, 2020 U.S. RIA Marketplace Report); No. 1 Independent Broker-Dealer in the U.S. (Based on total revenues, Financial Planning magazine 1996-2021); No. 1 provider of third-party brokerage services to banks and credit unions (2020-2021 Kehrer Bielan Research & Consulting Annual TPM Report); Fortune 500 Company as of June 2021. LPL and its affiliated companies provide financial services only from the United States.
Securities and advisory services offered through LPL Financial LLC, an SEC-registered broker-dealer and investment advisor. Member FINRA/ SIPC.
Throughout this communication, the terms “financial advisors” and “advisors” are used to refer to registered representatives and/or investment advisor representatives affiliated with LPL Financial LLC. We routinely disclose information that may be important to shareholders in the “Investor Relations” or “Press Releases” section of our website.
Please see the LPL Financial Research Outlook 2022 for additional description and disclosure.
The opinions, statements and forecasts presented herein are general information only and are not intended to provide specific investment advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, please consult your financial professional prior to investing.
Any forward-looking statements including the economic forecasts may not develop as predicted and are subject to change based on future market and other conditions.
The Standard & Poor’s (S&P) 500 Index tracks the performance of 500 widely held, large-capitalization US stocks. All indexes are unmanaged and cannot be invested into directly.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.
All investing involves risk including loss of principal. No strategy assures success or protects against loss.
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