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15 07, 2024

Weekly Market Commentary – Will deflation continue?

2024-07-15T13:44:51-04:00July 15th, 2024|Weekly Market Commentary|

The Markets Will deflation continue? In May, Pew Research asked Americans about the biggest problems facing our nation. The top three answers were: Inflation; The ability of Democrats and Republicans to work together; and The affordability of health care. Last week, there was some good news about the first issue. Inflation became deflation as the Consumer Price Index (CPI) fell in June after remaining unchanged in May. Headline inflation was ‑0.1 percent month over month. Megan Leonhardt of Barron’s reported on the CPI’s findings: “The details under the hood, so to speak, also largely provided good news for consumers [...]

8 07, 2024

Weekly Market Commentary – Despite some volatility, stock markets have been buoyant in 2024.

2024-07-08T17:28:55-04:00July 8th, 2024|Weekly Market Commentary|

The Markets Despite some volatility, stock markets have been buoyant in 2024. Enthusiasm for artificial intelligence (AI), optimism about inflation, and expectations that the United States Federal Reserve (Fed) will begin to lower rates this year have helped global and U.S. stock markets, overall, push higher in 2024. Share prices increased more slowly in the second quarter, though. Here’s what happened: Off to a rocky start. Overall, stocks declined in April after inflation numbers came in higher than economists had expected. That sparked concern the Fed might leave rates higher for longer than many investors hoped. “Markets had expected [...]

1 07, 2024

Weekly Market Commentary – Some good news and some volatility.

2024-07-01T14:38:52-04:00July 1st, 2024|Weekly Market Commentary|

The Markets Some good news and some volatility. Last week was a mixed bag as investors weighed positive economic news against concerns that stock prices for some chipmakers may not be sustainable. Here are the highlights: Inflation slowed to zero. On Friday, one of the Fed’s favored measures of inflation – the Personal Consumption Expenditures (PCE) Index – showed that headline inflation was flat in May. Both headline inflation and core inflation, which excludes volatile food and energy prices, were up 2.6 percent year over year. That’s a significant improvement from May 2023 when headline inflation was 3.8 percent [...]

24 06, 2024

Weekly Market Commentary – Are we at an inflection point?

2024-06-24T14:38:30-04:00June 24th, 2024|Weekly Market Commentary|

The Markets Are we at an inflection point? The transition to renewable energy has been moving forward and may be reaching an inflection point. In 2023, global renewable energy capacity increased by almost 50 percent, reported the International Energy Agency (IEA). Renewable capacity reached all-time highs in the United States, Europe and Brazil. However, the leader in new capacity is China. In 2023, the country “commissioned as much solar PV [photovoltaic] as the entire world did in 2022,” stated the IEA’s Renewables 2023 report. In the United States, solar power is responsible for a relatively small amount (3.9 percent [...]

17 06, 2024

Weekly Market Commentary – Inflation is lower – and so are some retail prices.

2024-06-17T15:16:50-04:00June 17th, 2024|Weekly Market Commentary|

The Markets Inflation is lower – and so are some retail prices. There was a lot of good news last week about the cost of products and services in the United States. First, inflation is slowing down. For the second month in a row, inflation slowed. Headline inflation was 3.3 percent year over year, lower than April’s 3.4 percent. In May, prices for gasoline and fuel oil, new cars, and clothing moved lower, while the cost of shelter, medical care, and eating out increased. Over the last 12 months, the price of used cars and trucks has dropped the [...]

10 06, 2024

Weekly Market Commentary – Another record high for the Standard & Poor’s (S&P) 500 Index!

2024-06-10T14:04:27-04:00June 10th, 2024|Weekly Market Commentary|

The Markets Another record high for the Standard & Poor’s (S&P) 500 Index! Last week, the S&P 500 Index hit its 25th record high for 2024. Investor enthusiasm for artificial intelligence helped drive the index to a new high. About 30 percent of the Index is information technology stocks. The S&P 500 also benefitted from reports that forecast a slowdown in hiring for May. Economists expected the jobs report to show 190,000 new jobs were added by U.S. employers in May, and hourly earnings increased by 3.9 percent over the last 12 months, reported Jeff Cox of CNBC. Why [...]

3 06, 2024

Weekly Market Commentary – Overall, May was a good month for investors.

2024-06-03T20:53:12-04:00June 3rd, 2024|Weekly Market Commentary|

The Markets Overall, May was a good month for investors. The adage, “Sell in May and go away,” would have been poor advice last month. Major stock indices in the United States finished the month higher. Connor Smith of Barron’s reported: The Nasdaq Composite was up 6.9 percent for May, The Standard & Poor’s 500 Index gained 4.8 percent, and The Dow Jones Industrial Average finished 2.3 percent higher. Despite the positive returns, May was also a volatile month for stocks as investors worried about inflation and whether the Federal Reserve will begin to lower rates in 2024, reported [...]

28 05, 2024

Weekly Market Commentary – Perception versus reality.

2024-05-28T14:37:44-04:00May 28th, 2024|Weekly Market Commentary|

The Markets Perception versus reality. A recent Harris poll, conducted on behalf of The Guardian newspaper, found that there is some confusion about the state of the American economy and U.S. stock market performance. A significant proportion of the Americans who participated think the economy and the stock market are in rough shape. Here are a few of the misperceptions uncovered by the poll: Misperception No. 1: The United States is in a recession, according to 56 percent of poll respondents. Reality: The U.S. is not in a recession. The economy has been expanding, not shrinking. Here are the [...]

20 05, 2024

Weekly Market Commentary – Reading the economic tea leaves.

2024-05-20T20:37:15-04:00May 20th, 2024|Weekly Market Commentary|

The Markets Reading the economic tea leaves. Tasseography practitioners read tea leaves to forecast the future. Some economic data serve a similar purpose. Policymakers, central bankers, economists, and investors look at leading economic indicators to forecast where the economy may be headed. Classic leading indicators include: Consumer confidence. Consumer spending is the largest contributor to economic growth in the United States. When consumers feel confident about their finances, the economy may continue to grow, and vice versa. The slope of the yield curve. When yields for short-term U.S. Treasuries are higher than yields for long-term U.S. Treasuries, then a [...]

13 05, 2024

Weekly Market Commentary – Higher rates are doing what they’re supposed to do.

2024-05-13T14:25:24-04:00May 13th, 2024|Weekly Market Commentary|

The Markets Higher rates are doing what they’re supposed to do. Last week, Federal Reserve officials spoke about keeping the federal funds rate higher until it becomes clear that inflation will reach the Fed’s two percent target rate. While people typically don’t mind earning more interest on their saving and investment accounts, higher rates are painful for consumers. That pain is why higher rates help lower inflation. They discourage borrowing and cause people to buy fewer goods. Lower demand for goods and services should lead to lower inflation, reported Trina Paul of CNBC. So far, the biggest fly in [...]

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