Market Insights - February 3, 2022

STOCKS MOSTLY UP THIS WEEK AS THE TECH-NAMES AND SMALLER-CAPS MAKE BIG MOVES AS THE FED RAISES RATES FOR THE 8TH TIME IN A ROW

Except for the mega-cap DJIA, which lost a tiny 0.2%, the other major equity markets continued their winning streaks, with the large-cap S&P 500 advancing 1.6% and the tech-heavy NASDAQ (+3.3%) and smaller-cap Russell 2000 (+3.9%) recording big gains. Even the developed, international markets, represented by the MSCI EAFE Index, gained 0.5% on the week.

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Source: Financial Media Exchange

Market Insights - January 27, 2022

STOCKS JUMP THIS WEEK ON POSITIVE GDP DATA, DECENT CORPORATE EARNINGS AND HOPES FOR A SMALLER RATE INCREASE FROM THE FED

Stocks resumed their winning streak – which makes 3 of the last 4 weeks – as Wall Street had its hopes renewed that the U.S. might avoid a recession this year as the Fed might engineer a soft landing after all.

It was clearly a growth week, as the Information Technology and Consumer Discretionary stocks led the way, bolstered by a big jump in Tesla and positive remarks from CEO Musk. Not surprisingly, the value names lagged the growth names considerably and the typical defensive sectors including Consumer Staples and Utilities underperformed.

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Source: Financial Media Exchange

Market Insights - January 20, 2022

STOCK MARKETS MIXED THIS WEEK AS Q4 CORPORATE EARNINGS STRUGGLE AND AS THE U.S. HITS ITS DEBT CEILING LIMIT 

The third week of 2023 was not a charm, as the major U.S. equity indices turned in a mixed performance, with only the tech-laden NASDAQ squeaking out a modest gain of 0.6%. While Wall Street digested a lot of economic data as well as corporate earnings, there remains a significant worry over a potential recession as well as with respect to how much the Fed might raise rates.

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Source: Financial Media Exchange

Market Insights - January 13, 2022

U.S. STOCK MARKETS ADVANCE ON THE FIRST TRADING WEEK OF THE YEAR, ENCOURAGED BY BETTER-THAN-EXPECTED JOBS DATA 

Equity markets recorded another week of gains, as Wall Street toggled between remarks from Fed Chair Powell on Tuesday, December’s inflation data on Thursday and the start of earnings season on Friday.

All told, sentiment on Wall Street felt like there might actually be a “soft landing” after all, causing many investors to shake off a few moments of downward selling pressures. Given the focus on rates and the Fed, it was no surprise that growth and tech stocks led the way, especially in some big household names – notably Amazon, Microsoft and Tesla.

This week also saw the start of Q4 earnings season, as big-banks JPMorgan Chase, Wells Fargo, and Bank of America beat consensus expectations, but there was still a palpable worry as the banks took a very cautious approach when talking about the rest of this year.

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Source: Financial Media Exchange

Market Insights - January 6, 2022

U.S. STOCK MARKETS ADVANCE ON THE FIRST TRADING WEEK OF THE YEAR, ENCOURAGED BY BETTER THAN EXPECTED JOBS DATA 

A big rally on Friday helped push stock markets into positive territory at the end of the first trading week of 2023. Trading volume was light, but a positive jobs report got investors off the sidelines and hopeful that the Fed will reduce its rate hike pace and magnitude some.

Interestingly, after Wednesday, optimists noted that the markets technically turned in a net gain over the Santa Claus rally timeframe, which is the last 5 trading days of the year and the first two of the New Year. Historically, that has been a good yearly omen for stock investors.

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Source: Financial Media Exchange

Market Insights - December 30, 2022

STOCKS MIXED AGAIN ON LIGHT HOLIDAY TRADING AS THE WEEK, MONTH, QUARTER AND YEAR-END COME TO A CLOSE 

In the final week of 2022, Wall Street saw light trading as the major indices retreated just a bit from the previous week. The Consumer Staples and Materials shares fell the most, while Financials and Energy performed best, helped by rising yields and rising oil prices.

Bond trading closed early on Friday afternoon and both the equity and bond markets will be closed on Monday in observance of the New Year’s Day holiday.

The final trading week of 2022 was very much in line with all of 2022, as the Value names outpaced the Growth names and the defensive sectors outpaced other sectors. But overall, there were not too many catalysts this week that pushed the markets around either way, except for maybe some tax-loss selling – but even that was light.

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Source: Financial Media Exchange

Market Insights - December 23, 2022

STOCKS MIXED ON VERY LIGHT TRADING AS BUILDING PERMITS TUMBLE WHILE CONSUMER CONFIDENCE AND SENTIMENT BOTH JUMP

The major U.S. equity indices were mostly down, as Wall Street saw light trading given the upcoming holidays. The DJIA scraped out a modest gain, driven by Nike and blue-chip Boeing, while the tech-heavy NASDAQ dropped close to 2%. The Russell 2000 and S&P 500 were in between the two.

There was a decent amount of economic data to digest, but most of the attention was given to falling housing data and improving consumer sentiment. Each seemed to play a role in pushing the markets slightly, but not as much as in previous weeks. There also seemed to be a general malaise hanging over Wall Street as last week’s hawkish Fed comments caused many to worry that the Fed will continue to tamp down on equity expectations in 2023. In addition, there was a decent amount of tax-loss selling before the year closes.

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Source: Financial Media Exchange

Market Insights - December 17, 2022

STOCKS RETREAT AS BETTER THAN EXPECTED ECONOMIC DATA DAMPENS HOPE THAT THE FED MIGHT SLOW ITS RATE HIKING MAGNITUDE

Once again, fears over rising rates pushed markets to another weekly loss, stoking worries that the Santa Claus rally won’t come visiting this year. Markets were performing exceptionally well through Tuesday mid-day, when better-than-expected CPI data showed cooling inflation, but once the details of the CPI data was scrutinized, a nervousness enveloped Wall Street that led to more selling Tuesday afternoon ahead of the Fed’s rate hike announcement.

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Source: Financial Media Exchange

Market Insights - December 9, 2022

STOCKS RETREAT AS BETTER THAN EXPECTED ECONOMIC DATA DAMPENS HOPE THAT THE FED MIGHT SLOW ITS RATE HIKING MAGNITUDE

U.S. equity indices retreated this week, eliminating much of the gains from the previous two weeks as strong economic data seemed to dampen expectations that the Fed would slow down its pace and magnitude of rate hikes. When the week was over, the DJIA fell out of its technical bull market (having advanced 20% last week from the September lows), the S&P 500 turned in its worst week in 5 weeks and the smaller-cap Russell 2000 turned in its worst week since September.

Of the 11 S&P 500 sectors, only Health Care was positive, with a meager gain of just 0.22%, whereas Communication Services and Energy both gave up more than 5%. The Energy sector is now down about 10% over the last month, driven mostly by falling oil prices that have not seen these prices since the early part of 2022.

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Source: Financial Media Exchange

Market Insights - December 2, 2022

STOCKS ADVANCE SLIGHTLY AS THE DJIA ENTERS A BULL MARKET WITH ALL EYES ON THE FED’S MID-DECEMBER FOMC MEETING

The major U.S. equity markets turned in another positive week, as Wall Street continued to try and guess whether the Federal Reserve might slow its pace and magnitude of future rate increases. And given the slight positivity to this week’s markets, one can surmise that Wall Street is cautiously optimistic.

On the week, it was the growth names outracing the value names, the small-caps outpacing the larger-caps and the tech-names advancing more than the blue-chip stocks of the DJIA. But cheerleaders of the DJIA rejoiced in the fact that the DJIA entered bull market territory this week, as it advanced 20% off of its low from September and is only 5% off of its all-time high.

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Source: Financial Media Exchange

Global Market Commentary: November 2022 

Market Performance Around the World 

Investors looking outside the U.S. saw excellent performance, as 38 of the 38 developed markets tracked by MSCI advanced in October, with 24 indices gaining more than 10%. Performance for emerging markets was also excellent, with 41 of the 46 indices positive for the month, with 23 gaining more than 15%.

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Source: Financial Media Exchange

S&P 500 Sector Performance for November 2022

For the month of November, sector performance was excellent, as all 11 sectors advanced healthily. For the month of October, sector performance was very good, as 9 of the 11 sectors were up for the month, with 7 up more than 5%.

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Source: Financial Media Exchange

Market Insights - November 25, 2022

WALL STREET THANKFUL FOR A POSITIVE WEEK AS RETAIL & TECH EARNINGS ARE DECENT & NEW HOME SALES SURPRISE ON THE UPSIDE

U.S. equities ended the day mixed, but the holiday-shortened week higher. Favorable earnings reports from some big retail and tech names helped drive equity markets to gains during the Thanksgiving week. And despite it being a short and quiet week – as measured by volume – the S&P 500 crested the 4,000-point threshold for the first time in a couple of months.

All of the 11 S&P 500 sectors advanced, with Materials and Utilities making the biggest gains, but there were hints of the Fed possibly slowing down its rate hiking pace that seemed to spur markets positively. There was not much new communications from Fed officials this week, but hopes were raised when the minutes from the Fed’s last meeting were revealed to say that a “substantial majority of participants” thought that slowing the pace of hikes would be appropriate.

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Source: Financial Media Exchange

Market Insights - November 18, 2022

U.S. STOCK MARKETS RETREAT SLIGHTLY AS THE PEAK INFLATION NARRATIVE HEATS UP AND THE YIELD CURVE INVERTS

Well, it wasn’t the crazy week we saw last week, as most of the major U.S. indices retreated slightly and closed slightly lower. On the whole, the value names outpaced the growth names, the mega caps outpaced the small caps and the tech names underperformed relative to the larger market stalwarts.

There was a decent amount of economic data received this week, and Wall Street fixated on it in an effort to gauge the Fed’s next move and whether a recession might be on the horizon. Half-way through the week, the Commerce Department reported that retail sales excluding the volatile auto segment rose 1.3% in October, significantly above consensus expectations and the biggest gain since May.

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Source: Financial Media Exchange

Market Insights - November 11, 2022

U.S. STOCK MARKETS SEE MASSIVE JUMP AS INFLATION DECLINES MODERATELY, TREASURY YIELDS PLUNGE AND THE U.S. DOLLAR DROPS

The major U.S. equity indices turned in an exceptional week, as lower-than-expected inflation numbers gave Wall Street hope that maybe inflation has peaked and maybe the Fed will be less hawkish at its next Fed meeting in December.

The first few days of the week were relatively benign, but when CPI data was released Thursday morning, markets jumped to their largest one-day gain since April 2020. Not surprisingly, growth stocks – especially the technology names – led the rally, on the belief that falling yields will benefit future growth.

Glass-half-full investors were celebrating that the Consumer Price Index only rose 0.4% last month, whereas consensus expectations were for a 0.6% rise. But the 12-month number of 7.7% is still stubbornly close to a 40-year high and certainly well above the Fed’s target rate. Which is probably why the futures market is assuming that there will be another major fed funds rate hike in December, with Wall Street predicting a 50 basis point hike versus a 75 basis point one.

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Source: Financial Media Exchange

Market Insights - November 4, 2022

U.S. EQUITIES DROP AS FED RAISES RATES BY 75 BASIS POINTS FOR THE 4th TIME AND ADOPTS A FIRMLY HAWKISH TONE

Wall Street was all-but-certain that the Fed would raise rates by 75 basis points, but there were still hopes that maybe there would be signs that future rate hikes might slow down. But those hopes quickly dissolved once the Fed started speaking in hawkish tones, with rates expected to go much higher for quite a while.

As a result, stocks retreated this week after last week’s big rally, with the tech-laden NASDAQ getting hit especially hard.

Generally speaking, growth names underperformed versus value, as evidence by the DJIA holding up better versus the other indices. And for the first time in a while, the large, household tech names – think Facebook (Meta), Amazon and Microsoft all underperformed, driven in part by disappointing earnings results and future guidance that didn’t inspire investors much. And while Twitter is now a private company, announced workforce reductions didn’t do the tech space any favors either.

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Source: Financial Media Exchange

Market Insights - October 28, 2022

U.S. EQUITIES LEAP AGAIN AS 3Q CORPORATE EARNINGS AND GROSS DOMESTIC PRODUCT BOTH SURPRISE ON THE UPSIDE

Stocks rose for the 4th week in a row, buoyed by corporate earnings that were better than feared and economic numbers that reassured Wall Street that maybe – just maybe – there might have been some overselling of good companies this past year. And there were also more than a few quiet hopes that the Fed might slow down its pace and magnitude of rate hikes after the Bank of Canada only raised rates by 50 basis points versus 75.

Interestingly, while markets made some good headway this week, there were a few big downers in the tech space, notably with Microsoft, Amazon and Meta (parent of Google). Some blame Elon Musk’s takeover of Twitter, but the reality is that many of the big tech names missed earnings and lowered their future outlooks, leading to more selling versus buying in those names.

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Source: Financial Media Exchange

Market Insights - October 21, 2022

U.S. EQUITIES LEAP AS HOUSING IS BEATEN DOWN REPEATEDLY WHILE CORPORATE EARNINGS HOLD UP BETTER THAN EXPECTED 

During the third trading week in October, stocks reversed course and made some big gains, as all the major U.S. equity indices were up close to 5%. The tech-laden and beaten-down NASDAQ had the best week, leaping +5.2%, followed by gains of +4.9% and +4.7% for the DJIA and S&P 500, respectively.

As of Friday’s close, with 20% of S&P 500 companies reporting actual results, 72% of S&P 500 companies have reported a positive EPS surprise and 70% of S&P 500 companies have reported a positive revenue surprise.

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Source: Financial Media Exchange

Market Insights - October 14, 2022

STOCKS AND OIL FALL WHILE 10-YEAR TREASURY CLIMBS ABOVE 4% FOR FIRST TIME SINCE 2008   

Stocks fell to start the week, then In an especially volatile session Thursday, stocks plunged to a new low after a hot consumer inflation report and then spring boarded sharply higher. That action has encouraged some strategists to believe the market has formed or is about to form at least a near-term bottom, even as stocks traded lower Friday.

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Source: Financial Media Exchange

Global Market Commentary: Third Quarter 2022 

Markets Have Awful Third Quarter 

Global equity markets had a rotten third quarter and when the final Wall Street-bell weakly tolled on Friday, September 30th, all major global equity markets were in the red, leading to overall market declines not seen in decades.

Further, entering the fourth quarter of 2022, the DJIA and S&P 500 are both at their lowest since November 2020, while NASDAQ is at its lowest since the end of July 2020.

The themes that drove market performance in the third quarter were the same worries that drove markets in the first two quarters and towards the end of last year. And the two most dominant themes continue to be inflation and the Fed – with the former rising to 40-year highs and the latter causing Wall Street to worry that the course of rising rates would lead to a recession.

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Source: Financial Media Exchange

Market Insights - October 7, 2022

WALL STREET FINALLY SEES GREEN DESPITE OIL SURGING AND THE LABOR MARKET SUPPORTING THE FED’S AGGRESSIVE RATE HIKE PLAN  

After three consecutive weekly declines, Wall Street finally turned in a positive week, but it was not as much as investors hoped for after Tuesday’s close. The bounce on Monday and Tuesday was exhilarating, as markets leapt more than 5% on Monday and Tuesday, recording the best 2-day move since 2020.

Interestingly, it was also the third best start to October since 1930, although that statistic probably doesn’t help investors much. Because unfortunately, the Monday/Tuesday momentum was derailed mid-week as better than expected economic data resurfaced, leading Wall Street to hop back on the Fed-worry train.

Among the week’s biggest news was when OPEC+ announced it was cutting oil production by 2 million barrels a week, sending the Energy sector soaring by over 13% and a barrel of oil up by over 17%.

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Source: Financial Media Exchange

S&P 500 Sector Performance for September 2022

For the month of September, sector performance was just terrible, as all 11 sectors declined for the month, with 5 of the 11 recording double-digit declines.

And while nine months is not very helpful when trying to draw conclusions, it is interesting to see the difference a few months make, as investors were reeling in January when 10 of the 11 sectors were red; March saw 10 of the 11 positive; April and May saw a mixed bag; June was all negative; July was overwhelmingly positive; August was mostly negative and September was all negative. That’s volatility.

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Source: Financial Media Exchange

Market Insights - September 30, 2022

WALL STREET CLOSES OUT A ROTTEN SEPTEMBER WITH ANOTHER DOWN WEEK AS EQUITY AND BOND MARKETS DROP  

Stocks Retreat for the 3rd Week in a Row

Worries around the world, especially in the UK but also domestically, pushed Wall Street to end the final week of September in the red, further deepening September’s losses and pushing markets firmly into bear market territory. And as if the week’s losses were not bad enough, investors will soon open their quarterly account statements and notice that the S&P 500 has given them 3 consecutive quarters of red numbers – the first time since 2009.

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Source: Financial Media Exchange

Market Insights - September 23, 2022

EQUITIES SUFFER AGAIN AS FED RAISES RATES BY 75 BPS AGAIN 

Stocks had another rough week as the Fed pushed rates up by 75 basis points and suggested that more rate hikes are to come. Yes, Wall Street was banking on a rate hike – as the futures market put odds at virtually 100% that rates were going up this week – but investors were unnerved, nonetheless.

Not surprisingly, the technology-heavy NASDAQ were hit the hardest, as investors are discounting future earnings given the pace and magnitude of predicted rate hikes. For perspective, rates are at the level not seen since March 2008 – and that was when the Fed was cutting rates.

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Source: Financial Media Exchange

Market Insights - September 16, 2022

EQUITIES SUFFER AS PEAK INFLATION HOPES ARE DASHED HIKES

Wall Street suffered its largest weekly drop in about 3 months as worries that inflation hasn’t peaked took center stage. And while most everyone was talking about how rough it was for equities, short-term bond yields hit levels not witnessed since 2007 too. It was a rough week.

Not surprisingly, growth stocks were hit harder than their value counterparts and the tech-laden NASDAQ fared the worst, dropping over 5%. And fittingly, Communication Services and Information Technology sectors were hard hit, as Google parent Alphabet and Facebook parent Meta Platforms hit fresh 52-week lows. Real Estate was also hit especially hard, losing over 5%.

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Source: Financial Media Exchange

S&P 500 Sector Performance for August 2022

For the month of August, sector performance was not good, as 9 of the 11 sectors declined for the month. Contrast that with the month of July, which saw 10 of the 11 advance and June, which saw all 11 retreat.

And while eight months is not very helpful when trying to draw conclusions, it is interesting to see the difference a few months can make, as investors were reeling in January when 10 of the 11 sectors were red (with only Energy gaining that month); March saw 10 of the 11 positive; April and May saw a mixed bag; June was all negative; July was overwhelmingly positive and August was mostly negative.

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Source: Financial Media Exchange

Market Insights - September 9, 2022

WALL STREET SNAPS 3-WEEK LOSING STREAK AS THE FED SUGGEST INFLATION MIGHT BE MODERATING AND OIL PRICES DECLINE AGAIN

Equities snapped a three week losing streak, as the major indices erased most of last week’s declines while investors grew confident coming out of the Labor Day weekend.

There was no big economic news or earnings reports that pushed Wall Street higher, but there were some subtle feelings that maybe we are close to a bottom – as oil dropped, inflation appeared to moderate in some spots, manufacturing came in stronger than expected and jobless claims pointed to a still healthy but tight labor market.

Looking at inflation, Wall Street took note of the Fed’s Beige Book, which summarizes economic reports from its branches, as it indicated that there are signs that inflation might be cooling. Specifically, the Beige Book indicated that price increases were moderating in 9 of the 12 districts, mostly driven by lower fuel prices.

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Source: Financial Media Exchange

Market Insights - September 2, 2022

EQUITY MARKETS RETREAT ON MORE HAWKISH FED COMMENTS AS JOB OPENINGS HIT NEAR RECORD LEVELS AND OIL PRICES DROP

Stocks ended the month of August and started the month of September on a losing streak, finishing lower for the month and for the third consecutive week. The driving force behind the selling was mostly attributed to the very-hawkish messages from Fed, including Fed Chair Jerome Powell’s recent speech at Jackson Hole on August 26th, but also comments from a Fed President suggesting that rates should be around 4.00% by early next year.

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Source: Financial Media Exchange

Market Insights - August 26, 2022

EQUITY MARKETS RETREAT ON HAWKISH FED COMMENTS AS VOLATILTY SPIKES AND INVENTORY OF NEW HOMES LEAPS TO 2008 LEVELS

Stocks started the week by heading lower, saw modest gains mid-week and ended Friday sharply lower, as investors felt less convinced that the Fed might engineer a soft landing in its rate-hiking policy. The good news (maybe) is that it was a slower summer trading week in terms of volumes, whereas the bad news is that just about everything except Energy had a rough week.

As one might expect amidst rate-hiking worries, the technology and high-growth stocks really underperformed, underscored by NASDAQ falling to its lowest level in about a month.

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Source: Financial Media Exchange

Market Insights - August 19, 2022

EQUITY MARKETS SNAP WINNING STREAK AT 4 AS RETAIL SALES COME IN STRONG AND THE FED CONTEMPLATES ANOTHER 75 BASIS-POINT HIKE

This week saw an end to 4 consecutive weeks of gains for equities and many felt as if investors were taking money off the table, given the recent run-up in stocks since mid-June. But underlying that sentiment was also worry that inflation may not have peaked, as the UK reported inflation north of 10%, with predictions for inflation reaching more than 13% over there this fall. Further, comments from a self-described hawkish Fed board member saying he supported another 75 basis-point rate hike this September caused Wall Street to hit the pause button.

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Source: Financial Media Exchange

Market Insights - August 12, 2022

EQUITY MARKETS MAKE BIG MOVES AS INFLATION SLOWS DOWN AND WALL STREET HOPES THAT THE FED MIGHT SLOW DOWN RATE HIKES

Stocks made a big jump this week after Consumer Price Index and Producer Price Index data showed signs that inflation – while still high – might be starting to slow. Numerous Fed officials reiterated the Fed’s fighting-inflation-stance, but Wall Street nonetheless traded on the good CPI and PPI news.

Interestingly, Wall Street also lowered its expectations for a 75-basis-point rate hike in September.

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Source: Financial Media Exchange

Market Insights - August 5, 2022

EQUITY MARKETS MIXED AS JOBS REPORT COMES IN STRONG AND OIL DROPS TO LOWEST LEVEL SINCE BEGINNING OF UKRAINE WAR

Stocks were mixed for the first week in August, hampered by a stronger-than-expected jobs report that caused Wall Street to once again worry that the Fed will maintain its aggressive rate-hiking schedule this year. Friday’s jobs report from the Labor Department showed employers added 528,000 nonfarm jobs in July, which was more than double consensus expectations. After July’s strong numbers, total nonfarm employment in the U.S. is back to its pre-pandemic level.

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Source: eMoney

S&P 500 Sector Performance for July 2022

Sector Highlights Through July 2022 For the month of July, sector performance was very good, as 10 of the 11 sectors advanced for the month, with only Communication Services (-1.38%) retreating. Contrast that with the month of June, which saw all 11 retreat for the month. And while seven months is not very helpful when trying to draw conclusions, it is interesting to see the difference a few months can make, as January saw 10 of the 11 sectors red (with only Energy green); March saw 10 of 11 positive; April and May saw a mixed bag; June was all down and July was all up.

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Source: eMoney

Market Insights - July 29, 2022

STOCK MARKETS ADVANCE DESPITE A TON OF NEGATIVE ECONOMIC DATA, INCLUDING HOUSING, MANUFACTURING AND JOBLESS CLAIMS

U.S. equity markets jumped again this week, despite the Fed raising rates by another 75-basis-points and news that the U.S. economy shrank by 0.9% in the second quarter – putting us in a technical recession. On the week, growth stocks handily outperformed value stocks as earnings came in better than feared, along with a few positive surprises, notably Amazon and Apple. The Federal Reserve was on everyone’s radar this week, as it pushed its fed funds rate to 2.25-2.50%, as everyone expected. But Federal Reserve Chair Jerome Powell seemed to appease Wall Street with his press conference when he talked about the need to continue fighting inflation while also hinting that the pace of future rate hikes might slow.

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Source: eMoney

Market Insights - July 22, 2022

STOCK MARKETS ADVANCE DESPITE A TON OF NEGATIVE ECONOMIC DATA, INCLUDING HOUSING, MANUFACTURING AND JOBLESS CLAIMS

Wall Street welcomed this week’s positive sentiment and positive numbers, as the end of last week’s momentum carried over through Thursday, until Snap released its earnings (and got hammered). Still, there were a lot of positive developments on the week when it came to market performance, corporate earnings, and investor sentiment, as all the major equity markets advanced, with smaller-caps leading the way. Growth outpaced Value this week, and the Consumer Discretionary names – pushed forward by Amazon and Tesla – really outperformed.

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Source: eMoney

Market Insights - July 15, 2022

INVESTORS SEE ANOTHER VOLATILE WEEK AS INFLATION NUMBERS COME IN RED-HOT AND Q2 EARNINGS REPORTS START TO ARRIVE   

U.S. Stock Markets Retreat Then Rally on Inflation Concerns Wall Street was tense all week, as looming inflation data from consumers and suppliers were on the week’s docket of economic reports set to be released. The good news on the week is that while stocks did get hammered early on, starting Thursday morning investors witnessed a decent rally that brought markets back to slightly less than where they started. The other good news on the week was that it was actually a pretty light trading week, in terms of volume.

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Source: eMoney

Market Insights - July 8, 2022

STOCK MARKETS END THE WEEK UP AS HOPES FOR A SOFT LANDING INCREASE AND AS JOBLESS CLAIMS SURPRISE   

U.S. equity markets clawed back most of last week’s decline as Wall Street gained a little bit of hope that the Fed might be able to engineer a soft landing after all (i.e., bring inflation down without causing a slowdown in growth). And while the positive numbers were not huge, they were celebrated as the gains took the S&P 500 out of bear market territory, as it is now down 19% from its January high. And the sectors that led this week’s gains have been dormant for quite a while, as the Communication Services, Consumer Discretionary, and Information Technology sectors all outperformed and rose more than 4% each. The Energy sector, on the other hand, dropped fast on the day after the 4th of July as oil tumbled below $100/barrel for the first time in two months, but then rallied later in the week to about $105/barrel. Still, a barrel of oil was more than 3% cheaper when the week was over.

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Source: eMoney

Market Insights - July 1, 2022

STOCK MARKETS END THE WEEK, MONTH, QUARTER AND YTD DOWN AS INFLATION AND THE FED CONTINUE TO WORRY WALL STREET     

The week saw a foursome of endings, as investors digested the ends of the first six months of the year, the second quarter, the month of June and the week. And all of those periods were negative. But the media was mostly focused on the end of the first half of the year and headlines kept screaming things like “worst first six months in 50+ years.” No matter the headlines, the truth is that U.S. equity markets did turn in a terrible second quarter to add to a not-so-great first quarter, pushing the major equity markets to levels not seen in a long time. And while many are suggesting that there is more pain to come from this bear, there are also plenty of others suggesting that the worst is behind us. But we of course won’t know for sure for another six months.

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Source: eMoney

Market Insights - June 24, 2022

STOCK MARKETS CATCH FIRE AS SUMMER STARTS AND WEAK ECONOMIC DATA SUGGESTS THAT INFLATION MIGHT BE MODERATING     

It was a holiday-shortened week, but Wall Street also welcomed the first day of summer as equities turned in a blistering rally, jumping more than 5% and erasing last week’s cold, winter-like returns. And while there was not any single catalyst that propelled markets, it was almost as if a few not-so-great economic reports caused Wall Street to hope that inflation might be moderating and that a soft-landing is indeed possible. When the week was over, 10 of the 11 S&P 500 sectors were positive, while the Energy sector was the only one registering negative weekly returns, as oil pulled back to just over $100/barrel.

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Source: eMoney

Market Insights - June 17, 2022

STOCK MARKETS RECORD WORST WEEK SINCE MARCH 2020 AS THE FED RAISES RATES SIGNIFICANTLY AND FEARS OF A RECESSION INTENSIFY     

Everyone knew the Fed was going to raise rates and some might have been surprised at the 75 basis point-hike, the most aggressive since 1994. But Wall Street nonetheless traded much lower, as fears that a recession is in the cards spooked investors. Besides it being another big week of losses (the major equity indices were down over 4% last week too), we also saw the S&P 500 record its worst weekly drop since March 2020 and saw it firmly jump into bear market territory.

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Source: eMoney

Market Insights - June 10, 2022

STOCK MARKETS SEE UGLY DECLINE AS INFLATION HITS ANOTHER 40-YEAR RECORD AND CONSUMER SENTIMENT HITS WORST-EVER MARK  

U.S. equity markets registered some ugly losses this week, despite having gone up on Monday and Tuesday. Most of the negative sentiment began to percolate on Thursday and then really bubbled over on Friday when hotter-than-expected inflation numbers were released in the morning. There was a lot of negative economic data on the week, especially buried among the details of the CPI data from the Bureau of Labor Statistics. But there was also plenty of negative data early in the week from retailers and manufacturers and as the week wore on, many retailers were suggesting that inventories could be problematic in the short-term.

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Source: eMoney

Market Insights - June 3, 2022

EQUITY MARKETS COOL AS WALL STREET HOLDS ITS BREATH HOPING THE FED CAN ENGINEER A SOFT LANDING WITHOUT CAUSING A RECESSION     

U.S. equities gave back some of the previous week’s gains, as Wall Street continued to cast doubt over whether the Fed might engineer a soft landing as it seeks to curb inflation without triggering a recession. While it was only a four-day trading week as markets were closed Monday in observance of Memorial Day, much of what unsettled investors were comments from JPMorgan Chase CEO Jamie Dimon who said he saw an “economic hurricane” coming. Then when Tesla CEO Elon Musk said he had a “super bad feeling” Wall Street was further unnerved. Finally, Musk capped off that comment with an announcement that Tesla needed to cut 10% of its workforce, freeze hiring and that its employees needed to return to offices. There was a lot of economic data reported in the short-week, and much of it actually argued against a looming recession, especially on Friday when the Labor Department announced that employers added 390,000 nonfarm jobs, well ahead of expectations.

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Source: eMoney

Mixed S&P 500 Sector Performance for May 2022

For the month of May – as was the case in April – sector performance was mixed, as 6 of the 11 S&P 500 sectors were green (versus 4 of the 11 in April). And while five months is not very helpful when trying to draw conclusions, it is interesting to see the difference a few months can make, as investors were reeling in January when 10 of the 11 sectors were red (with only Energy gaining that month), March saw 10 of the 11 positive and April and May saw a mixed bag.

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Source: eMoney

Market Insights - May 28, 2022

EQUITY MARKETS LEAP ON HOPES THAT INFLATION IS PEAKING AND AS INVENTORIES ARE BUILDING UP AND HOUSING IS COOLING OFF    

Stocks Finally Head North After 7 (and 8) Consecutive Declines It was a fantastic week for U.S. equity markets, as the major indices jumped more than 6% on the week. Every single one of the 11 sectors in the S&P 500 advanced, with Consumer Discretionary and Energy making big leaps and Health Care under-performing relative to the others. There was some optimism on Wall Street and Main Street that inflationary pressures might have or might be peaking. The second estimate of GDP saw some downward revisions and manufacturing output and new orders were strong. But it was consumer spending that excited Wall Street.

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Source: eMoney

Market Insights - May 20, 2022

EQUITY MARKETS RETREAT FOR THE SEVENTH WEEK IN A ROW AS EARNINGS DISAPPOINT, ESPECIALLY AMONG THE LARGE RETAILERS    

It was another rough week for U.S. equity markets, as equities retreated for the seventh week in a row as volatility was rampant. The biggest drivers of worry were interest rates and inflation, as Wall Street felt another week of negative sentiment, especially within the tech and growth names. Those two sentences have been used to describe the past couple of months of market performance.

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Source: eMoney

Market Insights - May 13, 2022

EQUITY MARKETS RETREAT FOR THE SIXTH WEEK IN A ROW AS VOLATILITY SPIKES AND HEADLINE INFLATION REMAINS WAY TOO HIGH    

It was another rough week for U.S. equity markets, as equities retreated for the sixth week in a row as volatility was rampant. The biggest drivers of worry were interest rates and inflation, as Wall Street felt another week of negative sentiment, especially within the tech and smaller-cap names. Interestingly, those two exact sentences were used to describe last week’s markets – except the word “fifth” was replaced with “sixth.” 

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Source: eMoney

Market Insights - May 4, 2022

Construction Spending Up Slightly This Past Month and Up Dramatically Since This Time Last Year 

Construction spending is viewed as a good indicator of the economy's momentum because both individuals, businesses and our governments generally only put money into construction when they are confident to justify the building expenses (that might not be as true with respect to our local-, state- and federal-government, but that’s another topic altogether). On May 2nd, the U.S. Department of Commerce reported on construction spending which follows. 

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Source: eMoney

Mixed S&P 500 Sector Performance - April 2022

Only 4 of the 11 sectors were positive and the range was unusually wide

For the month of April, sector performance was mixed, as only 4 of the 11 S&P 500 sectors were green, compared to 10 of the 11 last month. And while four months is not very helpful when trying to draw conclusions, it is interesting to see the difference a few months can make, as investors were reeling in January when 10 of the 11 sectors were red (with only Energy gaining that month), March saw 10 of the 11 positive and April saw a mixed bag.

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Source: eMoney

Market Insights - April 30, 2022

MARKETS RETREAT AGAIN THIS WEEK AS GDP GOES NEGATIVE AND PREDICTIONS FOR A RECESSION AND STAGFLATION GET LOUDER

It was another really rough week for U.S. equity markets, as the major indices recorded their fourth consecutive week of declines and closed the books on the month of April. When the week was over, there were a few ugly milestones that Wall Street recorded. On Tuesday, the U.S. Census Bureau announced the Advance Durable Goods Orders report for March.

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Source: eMoney

Market Insights - April 22, 2022

MARKETS LOSE GROUND AGAIN THIS WEEK AS THE 10-YEAR JUMPS AND INVESTORS’ BULLISHNESS HITS A NEW 30-YEAR LOW

Once again, the major U.S. equity indices lost ground, marking the 3rd consecutive losing week for the S&P 500 and the 4th for the DJIA. And as has been the case for the past few weeks and months, the value-names outperformed the growth names and the mid-caps outperformed the large-caps, although the smaller-caps performed worse than both the mid- and large-caps.

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Source: eMoney

Market Insights - April 15, 2022

MARKETS RETREAT AGAIN AS 40-YEAR HIGH INFLATION NUMBERS RATTLE WALL STREET, ESPECIALLY THE GROWTH AND TECH NAMES

U.S. equity and bond performances were down again this week, as Wall Street digested very frothy inflation numbers as first quarter earnings season kicked off. As was the case last week, growth names and large-cap tech names were hit especially hard. Value stocks continued to outperform their growth cousins, but the small-caps picked up some momentum and outperformed the larger-caps.

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Source: eMoney

Market Insights - April 6, 2022

Factory Orders Down for First Time in 10 Months as Backlogs Persist

Factory orders represent the dollar level of new orders for both durable and nondurable goods. The data shows how busy factories will be in coming months as manufacturers fill those orders (it is technically called the Manufacturers’ Goods Report). This report provides insight to the demand at factories making all kinds of goods, and in addition to tracking new orders, it is worth paying attention to unfilled orders too as that is an indicator of production backlogs.

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Source: eMoney

Market Insights - April 1, 2022

MARKETS MIXED AS THE MONTH AND QUARTER COME TO A CLOSE, GDP IS REVISED DOWN AND CORE PCE PRICE INDEX HITS HIGHEST LEVEL SINCE 1983

Despite a mixed week for U.S. equity markets, Wall Street reversed the negative course of the past two months and ended March in positive territory. But it was still not enough to overcome the biggest two-month drop (January and February) since March 2020 as markets ended the 1st quarter of 2022 in the red – the first since the 1st quarter of 2020. On the week, it was the defensive-Real Estate (+4.4%) and defensive Utilities (+3.7%) sectors that outperformed while the interest-rate-sensitive Financials (-3.3%) and the oil-sensitive Energy (-2.4%) sectors underperformed. The major theme driving markets was once again the war in Ukraine. The week started off well for markets as there were reports that Russia and Ukraine were inching closer to a cease-fire, but then by mid-week the markets four-day winning streak was snapped when Russia said that a cease-fire agreement was not very close.

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Source: eMoney

Market Insights - March 25, 2022

MARKETS UP TWO WEEKS IN A ROW AS OIL AND THE 10-YEAR JUMP WHILE WALL STREET TRIES TO PREDICT THE FED’S RATE-INCREASE-PATH

Volatility trended down this week, but just about every single day saw a spike, usually right around the lunch-hour. But when the week was over, the three major U.S. equity markets were higher as the smaller-caps struggled just a little bit. While two weeks certainly doesn’t make a trend, glass-half full investors were celebrating that the S&P 500 closed at its highest level since February 10th. Speaking of that daily volatility spike, if you paid attention to market levels throughout the day, you could detect a clear pattern: markets traded lower in the morning, volatility spiked around lunch and then markets traded higher in the afternoon. In fact, Bloomberg reported that the S&P 500 had gained one-third of one percent in the last hour of trading for five consecutive days—the longest streak in two decades. Some might call this “buy-the-close.” 

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Source: eMoney

Market Insights - March 18, 2022

MARKETS MAKE HUGE LEAPS AS OIL PRICES RETREAT AND AS THE FED INCREASES THE FED FUNDS RATE

Equities jumped on the week, putting a halt to the recent 5-week slide and making up considerable ground at the same time. There really wasn’t one or two main drivers of performance, but sliding oil prices, the Fed’s policy meeting and maybe a lot of “buy the dip” seemed to contribute to the week, which ended with 4 consecutive up-days. Gains were everywhere except the Energy sector, which dropped more than 3% as oil slid below $100/barrel mid-week before coming to rest at about $105/barrel. NASDAQ had a monster week, leaping over 8%, which was a little surprising given that in the middle of this week the Federal Reserve moved its fed funds target rate from near zero to a range of 0.25% to 0.50%. And that usually causes stocks – especially tech stocks – to lose ground. The other good news on the week is that NASDAQ is no longer considered to be within bear-market territory and the DJIA, S&P 500 and Russell 2000 are no longer in correction territory. 

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Source: eMoney

Market Insights - March 11, 2022

MARKETS RETREAT FOR THE FIFTH WEEK IN A ROW AS SURGING INFLATION, OIL PRICES AND COMMODITIES ROIL WALL STREET

For the 5th consecutive week, Wall Street endured volatility and ended the week lower than where it started, as all the major U.S. equity markets lost ground and the 10-year Treasury yield hit that purely-psychological 2.00% threshold. And on Tuesday, NASDAQ officially entered bear market territory, defined as a loss of 20% from its recent peak (NASDAQ is off 22% from its recent peak). Silver lining (not really) is that the S&P 500 has a ways to go until it hits bear market ground, as it’s off 14% from its recent peak, still solidly in correction territory. Commodity prices jumped on the week, as oil hit $139/barrel, a level not seen in almost 15 years, as President Biden announced that the U.S. was cutting off all imports of Russian oil and gas. But other commodities are surging too, including nickel and wheat. In fact, nickel got so out of hand early in the week that trading was suspended as it doubled in value in a single day. But it was still the price of oil that dominated the economic news, especially relative to CPI numbers.

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Source: eMoney

Market Insights - March 4, 2022

MARKETS SUFFER MORE VOLATILITY AS CONDITIONS WORSEN IN UKRAINE AND AS OIL PRICES SKYROCKET 25% ON THE WEEK

Markets Drop as Oil Prices Surge. It was another volatile week for Wall Street, as Russia’s invasion of Ukraine intensified, pushing domestic markets to slump, developed-international markets to retreat and emerging markets – especially those in Eastern Europe – to continue dropping significantly. When the week was over, U.S. equity markets were lower, pushing NASDAQ further into correction territory for the year and leaving the DJIA and S&P 500 one or two poor trading days away from correction levels.

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Source: eMoney

Global Market Commentary - February 2022 Recap

Military conflicts have not been a major factor in market movements for decades. But Russia’s invasion of Ukraine has put global relations back on investors’ minds. Since the fall of the Soviet Union, investors have enjoyed decades of global economic stability in which military conflicts and foreign diplomacy played a diminished role in the movements of markets. But Russia’s invasion of Ukraine is the most overt sign of a recent change in that dynamic as increased jostling among powerful nations will have sweeping consequences for investors.

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Source: eMoney

Market Insights - February 25, 2022

MARKETS ENDURE MORE VOLATILITY AS RUSSIA INVADES UKRAINE BUT REBOUND WHEN RUSSIA INDICATES IT IS READY FOR DIPLOMATIC TALKS

Markets Rebound Late in the Week After Falling Big It was a holiday-shortened week for Wall Street, but wow did investors deal with a lot (markets were closed Monday in observation of Presidents Day). Worries of a Russian invasion of Ukraine came true and volatility spiked on Thursday to a 2-year high as markets dropped dramatically, especially the futures markets on Wednesday night. For perspective, on Thursday, NASDAQ saw a daily swing of almost 7%, trading down by almost 4% and then recovering and tacking on a gain of 3.5% for the day. Here is another example of volatility – Tesla added about $100 billion to its market cap on Thursday alone – but was still down more than 5% on the week.

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Source: eMoney

Market Insights - February 18, 2022

MARKETS RETREAT AGAIN AS INFLATION RAGES, WALL STREET PREPARES FOR FED RATE HIKES AND THE WORLD BRACES FOR A RUSSIA INVASION

The themes of this week were the exact same themes as the prior week: more inflation and worries about a Russian invasion of Ukraine. And while the former saw the Producer Price Index leap almost 10% year-over-year, it was the latter that pushed Wall Street’s emotions all over the board. When the market closed on Friday afternoon, the major U.S. equity indices recorded their second consecutive weekly decline, pushing the YTD numbers further into the red. All the major U.S. equity indices recorded losses of at least 1% and now NASDAQ and the Russell 2000 are solidly within the double-digit loss column for 2022, with the S&P 500 about one poor trading day away and the DJIA about two away. If there was any good news on the week, it was that trading volumes were light as Wall Street eagerly awaited the upcoming long weekend. Markets scheduled to be closed on Monday, February 21, in observance of Presidents Day.

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Source: eMoney

Market Insights - February 12, 2022

LARGE CAPS RETREAT AS SMALL- AND MID-CAPS ADVANCE AMIDST 40-YEAR-HIGH INFLATION NUMBERS AND WORRIES OVER UKRAINE

It was another volatile week, especially on Thursday and Friday and the major large-cap U.S. equity indices gave back last week’s gains, while the smaller-cap Russell 2000 and MSCI EAFE (developed, international equities) advanced on the week. The themes of the week were twofold: more inflation and worries about a Russian invasion of Ukraine.

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Source: eMoney

Market Insights - February 4, 2022

MARKETS RISE DESPITE ANOTHER VOLATILE WEEK ON STRONG JOBS DATA AND DESPITE OIL GETTING A LOT CLOSER TO $100/BARREL 

Equity markets continued their volatile ways, but when the week concluded, all the major U.S. indices were green. The markets were marching steadily along until about Wednesday afternoon and when markets opened Friday morning, investors were seeing a lot of red, somewhat driven by large tech names (Facebook) that seemed to pull the markets down. For perspective, on Thursday alone (the day Facebook reported earnings and its stock tumbled 25%), the DJIA had dropped 1.5%, the S&P 500 declined 2.4% and NASDAQ cratered 3.7%. 

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Source: eMoney

Market Insights - January 28, 2022

MARKETS MIXED AS VOLATILITY JUMPS AMIDST FED WORRIES, A BIG EARNINGS WEEK AND MUCH BETTER-THAN-EXPECTED GDP NUMBERS 

It was a very volatile week for equities and there were a lot of large intraday swings as most of the week seemed to continue last week’s hammering. But when it was over, the larger-cap DJIA and S&P 500 wrung out modest gains, almost right after moving into correction territory. The small-cap Russell 2000 Index, however, did not fare as well, dropping 1% on the week and flirting with bear market territory, as it is off almost 20% from its peak last November. Volatility as measured by the CBOE Volatility Index reached its highest level since the beginning of the pandemic. And January has seen a significant increase in volatility too.

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Source: eMoney

Market Insights - January 21, 2022

MARKETS GET HAMMERED AS WORRIES ABOUT PROFIT MARGINS TAKE CENTER STAGE AND NASDAQ ENTERS CORRECTION TERRITORY

On the third week of 2022, equity markets hit levels not seen in some time, and the levels were not good ones either. The S&P 500 saw its biggest decline in about 14 months and NASDAQ saw its biggest decline since the start of the pandemic, ending the week comfortably in correction territory as it is off more than 10% since its recent highs. Rising interest rate fears and future growth prospects seemed to worry Wall Street and every day seemed to be worse than the previous – and there were only 4 trading days because markets were closed Monday in observance of the Martin Luther King, Jr., holiday. Declines were everywhere, as all of the S&P 500 sectors ended the week in the red. And there was a lot of negative news from big household names too – including JP Morgan Chase, Goldman Sachs, Netflix, and Peloton.

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Source: eMoney

Market Insights - January 14, 2022

MARKETS RETREAT FOR THE SECOND WEEK IN A ROW, AS INFLATION HITS HIGHEST LEVEL IN DECADES & THE BIG BANKS DISAPPOINT 

The U.S. equity indices recorded their second weekly loss to start 2022, driven by inflation worries and disappointing earnings from the big banks. While inflation dominated the headlines – with the Consumer Price Index and Producer Price Index coming in much hotter than expected – the big banks disappointed on Friday after reporting lower profits in the final quarter of 2021. The Energy sector outperformed all others, driven by a jump in oil prices, pushing oil to prices not seen since last fall. And the defensive names (Utilities and Real Estate) underperformed on the week too.

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Source: eMoney

Market Insights - January 7, 2022

MARKETS RETREAT ON THE WEEK, AS GROWTH AND TECH ARE HIT ESPECIALLY HARD AFTER THE FED ADOPTS A HAWKISH STANCE

Stocks hit record highs at the beginning of the week, but then the minutes from the Fed’s December FOMC meeting were released and Wall Street rotated away from the growth and tech names into the value and defensive plays as bond yields increased. NASDAQ was hit especially hard, as it suffered its biggest one day decline since February of last year, as rising rates can take a toll on future earnings. Energy stocks on the other hand, had a fantastic week, as the price of WTI Crude seems headed for that $80/barrel threshold.

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Source: eMoney

Market Insights - December 31, 2021

MARKETS END THE WEEK MOSTLY POSITIVE AS HOUSING AND JOBLESS CLAIMS SURPRISE ON THE UPSIDE AMIDST MUTED TRADING VOLUMES

U.S. stocks continued last week’s rebound, except for the tech-laden NASDAQ which slipped a bit. The S&P 500, DJIA and Russell 2000 all ended the week positive, as Wall Street closed the books on the week, the month, the quarter and the year. There was not a lot of economic news that pushed markets around, but there was some rebalancing as the quarter and year came to a close. Value outpaced growth names and the mega-caps outperformed the smaller and mid-size names on the week.

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Source: eMoney

 

Washington Wealth Advisors Disclosure

Washington Wealth Advisors (WWA) is a registered investment advisor located in Falls Church, Virginia.  Additional information about our firm can be found in Washington Wealth Advisor's Form ADV Part 2 accessible for download on our Form ADV website page.

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