Market Overview - The S&P 500 has reached an all-time high of 6,173.07 points, up 0.5% on Friday, surpassing its previous record of 6,147.43 points [3][8] - The index has rebounded over 20% from its April lows and has gained nearly 5% year to date, driven by easing geopolitical tensions and hopes for Federal Reserve rate cuts [6][8] Geopolitical and Economic Factors - Geopolitical tensions, particularly between Iran and Israel, have eased, contributing to investor confidence [6] - The Federal Reserve is expected to resume rate cuts, with officials hinting at a potential cut as early as July, which could further support the S&P 500 rally [7] Company Highlights Adobe Inc. (ADBE) - Adobe is a leading software company with an expected earnings growth rate of 11.9% for the current year, and its earnings estimate has improved by 1.2% over the past 60 days [9] - ADBE currently holds a Zacks Rank of 2 (Buy) [9] Altria Group, Inc. (MO) - Altria is adapting to industry changes by expanding into the smokeless category, with an expected earnings growth rate of 4.9% for the current year and a 1.7% improvement in earnings estimates over the past 60 days [10] - MO also holds a Zacks Rank of 2 [10] Arista Networks, Inc. (ANET) - Arista provides cloud networking solutions and has an expected earnings growth rate of 13.2% for the current year, with a 4% improvement in earnings estimates over the past 60 days [12] - ANET is currently rated as a Zacks Rank 2 [12] Atmos Energy Corporation (ATO) - Atmos Energy is involved in regulated natural gas distribution and storage, serving approximately 3.3 million customers [13] - The company has an expected earnings growth rate of 6% for the current year, with a 0.6% improvement in earnings estimates over the last 60 days [14] - ATO also carries a Zacks Rank of 2 [14]

Mortgage rates haven’t exactly been affordable lately. The average 30-year mortgage rate has hovered between 6% and 7% for the bulk of the last two years. At one point, it even reached as high as 7.79% — the highest point in decades, according to Freddie Mac. It’s a far cry from the bargain-basement rates we saw in the height of the COVID-19 era, when rates bottomed out at a mere 2.65%, the lowest ever recorded. Those ultra-low rates were likely a once-in-a-lifetime occurrence, borne from the Federal Rese ...

Core Viewpoint - AGNC Investment has a high dividend yield of approximately 16%, but its stock price has been declining, raising questions about the sustainability of its payout and whether it is a good investment opportunity [1]. Group 1: Company Overview - AGNC is a mortgage real estate investment trust (mREIT) that primarily invests in agency mortgage-backed securities (MBS) guaranteed by Fannie Mae and Freddie Mac, which carry virtually no credit risk [1]. - The company has faced significant challenges due to rising mortgage interest rates and widening spreads between MBS yields and Treasury yields [2][3]. Group 2: Financial Performance - AGNC's tangible book value (TBV) has decreased by 45% from $15.75 at the end of 2021 to $8.70 per share by the end of 2023, and further declined to $8.25 at the end of Q1 2025 [4]. - The company has maintained its dividend payout despite a challenging environment, although this has impacted its TBV [10]. Group 3: Market Conditions - The Federal Reserve's aggressive interest rate hikes have contributed to higher mortgage rates, which have negatively affected AGNC's performance [2]. - The yield curve has been inverted, which is unfavorable for AGNC's income generation model, but it has recently flipped to a positive slope, potentially benefiting the company [7][8]. Group 4: Future Outlook - Fed Chairman Jerome Powell has indicated potential rate cuts, which could lower AGNC's short-term funding costs and improve MBS valuations, positively impacting TBV [5][6]. - If MBS-to-Treasury yield spreads narrow as banks re-enter the MBS market, AGNC could see a recovery in both its book value and share price, leading to potential total returns of 20% to 25% annually in the coming years [13][14]. Group 5: Investment Considerations - AGNC is characterized as a high-risk, high-reward income investment, with the current market conditions possibly turning in its favor after enduring the impact of higher interest rates [15]. - For income-focused investors, AGNC presents a high yield with strong potential upside, although it requires active management and understanding of associated risks [16].

Market Overview - The S&P 500 and Nasdaq-100 indices are currently about 10% and 13% below their respective peaks from 2025, indicating they are out of bear market territory [1] - Some index funds and actively managed ETFs remain in bear markets, defined as being 20% or more below their highs [1] Small-Cap Stocks - Small-cap stocks are trading at their lowest price-to-book valuations relative to large-cap stocks in over 25 years, with the gap widening since the start of 2025 [2] - The average stock in the Russell 2000 small-cap index has a price-to-book multiple of 1.8, compared to 4.6 for the typical S&P 500 stock [3] Investment Vehicles - The Vanguard Russell 2000 ETF (VTWO) is highlighted as a preferred investment option due to its low expense ratio of 0.07% and its diversified holdings across 2,000 small-cap stocks [4] - The Vanguard Real Estate ETF (VNQ) is currently 25% below its all-time high, affected by the rising-rate environment that has placed REITs in a technical bear market [5][6] Real Estate Sector - Elevated interest rates negatively impact REITs by making risk-free returns more attractive, increasing the cost of capital, and leading to declines in commercial property values [6] - There is potential for a turnaround in the real estate sector, with expectations of four 25-basis-point Federal Reserve rate cuts by year-end, alongside a 4.2% yield from the VNQ ETF [7] Technology Sector - The Ark Autonomous Technology & Robotics ETF (ARKQ) is an actively managed ETF that focuses on AI investment opportunities, differing from traditional AI index funds by not being top-heavy with big tech stocks [8][9] - The ETF is currently about 18% below its 2025 peak and 30% below its all-time high, presenting a potential investment opportunity for those interested in AI [10]

Real estate investment trusts, or REITs, aren't well known for their volatility, and as a group, they tend to be more resilient than the typical S&P 500 company during tough times.We're seeing this during the recent market downturn. The S&P 500 is down by roughly 12% as of this writing, since President Trump's tariff plan was announced, but the real estate sector is down by less than 10%.However, one of the most rock-solid companies in the real estate sector has taken quite a beating. Industrial real estate ...

Core Insights - The 10-year Treasury note serves as a crucial fundraising tool for the U.S. government and is viewed as a safe investment, reflecting overall economic sentiment [1][2][3] Group 1: Treasury Note Overview - The 10-year Treasury note is issued by the U.S. Treasury to individuals, financial institutions, and foreign governments, providing fixed interest payments every six months until maturity [2][3] - Treasury notes are considered among the safest investments due to being backed by the U.S. government [3] Group 2: Impact on Mortgage Rates - The 10-year Treasury yield is a reference point for national long-term interest rates, particularly mortgage rates, which typically move in tandem with Treasury yields [4] - Historically, the spread between the 10-year Treasury yield and mortgage rates has been between one to two percentage points, but it has recently widened to over two percentage points [4][5] Group 3: Treasury Yields and Economic Indicators - Treasury yields are influenced by various market factors, including overall economic conditions, inflation, and interest rate moves by the Federal Reserve [8] - The relationship between Treasury yields and mortgage rates can be volatile, with recent trends showing that yields rose following the Federal Reserve's rate cuts [6][9] Group 4: Investment Characteristics - Treasury yields represent the return on investment, with fixed-rate interest paid every six months, and the principal returned at maturity [9][10] - The relationship between bond prices and yields is inverse; as prices rise, yields fall, indicating investor sentiment regarding inflation and economic growth [11][12] Group 5: Treasury Instruments - Treasury instruments include bills, notes, and bonds, differentiated by their maturities, with notes typically issued in two to 10-year maturities [15] - The 10-year Treasury note is considered a low-return fixed-income investment, appealing to risk-averse investors [16]