“There is no better environment for financial assets than the one we have right now. Stocks and bonds are not something you want.”
Paul Tudor Jones, Tudor Investment Corp.
Paul Tudor Jones is a billionaire investor who called the 1987 stock market collapse and previously raised alarm over rising inflation pressures.
Read:Paul Tudor Jones identifies inflation as the greatest threat to society and markets in general
In Interview with CNBCThe manager of a hedge-fund stated Tuesday that investors are in unfamiliar territory and should prioritize capital preservation. The inflation backdrop is reminiscent the 1970s, which presents challenges and raises questions about whether investors will actually try to make money during this period.
Stocks have been hit hard by rising Treasury yields in 2022. This has led to investors trying to gain control of a Federal Reserve policy expected to increase interest rates and shrink its balance sheets to catch up with inflation that has been at an unprecedented four-decade high. Investors are increasingly concerned that the Fed’s tightening monetary policy will lead to a recession. This is in an effort to control inflation.
Both stocks and bonds were both affected by the April slump in the S&P 500.
SPX,
Sliding nearly 9%, and the JPMorgan U.S. Aggregate Bond ETF
JAGG,
According to FactSet data, the drop was almost 4%
Rising yields have had a particularly devastating effect on technology and other growth stocks like the Nasdaq Composite
COMP,
The S&P 500 is down nearly 20% so far this year, including more than 20% from its November record finish. This puts it in a bearish mood. The S&P 500 was down 12.8% thus far this year. It slipped back into market corrections last week.
DJIA,
Was off 9% year-to-date
