Weekly Market Commentary 7-13-2026

“A Fed Chair Without a Grace Period”
See what we have to say about the following:

 

 

 

 

• A Fed Chair Without a Grace Period – Persistent inflation, elevated energy prices, and geopolitical uncertainty are expected to keep the Fed on hold, making income generation the primary driver of bond returns in the second half of 2026.

 

• From Multiple Cuts to a Potential Hike: Market Fed Pricing – The market has shifted from expecting multiple rate cuts to considering the possibility of a rate hike, while Treasury yields have risen due to economic resilience rather than unanchored inflation fears.

 

• A Historic Borrowing Wave / Hyperscaler Debt Issuance Has Gone Vertical – Massive AI-related borrowing by major technology companies is increasing corporate bond issuance, but strong fundamentals and investor demand are expected to keep credit spreads relatively stable.

 

• Asset Allocation Insights (STAAC) – STAAC remains neutral on duration, favors a tactical overweight to equities, and prefers quality-focused bond sectors while maintaining caution toward investment-grade corporates and mortgage-backed securities due to tight spreads.