‘Tread Lightly in Stocks’ as TED Spread Widens: Chart of the Day
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Investors ought to “tread lightly in stocks” because credit markets have yet to show the kind of optimism that lifted share prices this month, according to Gina Martin Adams, a Wells Fargo & Co. strategist.
The CHART OF THE DAY highlights an indicator that Martin Adams used to draw her conclusion: the TED spread, or the gap between what financial companies and the U.S. government have to pay for three-month loans. The chart compares the spread with the Standard & Poor’s 500 Index since 2009.