Good morning,


In the US, jobs data surprised to the upside on Friday (full details below) and the initial reaction was one of ‘good news means bad news’. A phenomenon that has been particularly prevalent in the latest rate hiking cycle, it means that when economic data is surprisingly strong risk assets fall as investors believe that it will lead to higher interest rates, which will ultimately lead to weaker future growth.


However, by evening, growth stocks had led the US market higher, and the US dollar had fallen against its main peers. Neither of these moves confirm the ‘good news is bad news’ thesis. It can be hard to completely unpack what this means, but it does recall the concept of ‘trading vs investing’. No doubt many would have lost based on the direction of the market on Friday which had a clear binary outcome. However, for those who are investing, Friday served yet another reminder to always keep an open mind, maintain flexibility, and to always respect the market. Which, to quote JM Keynes, can remain ‘irrational’ longer than you can remain solvent.


As always, if you wish to discuss anything in further detail, please do get in touch.