Week in Review for the week ending 5-24-24
This past week brought mixed results for the major U.S. stock indexes. The Dow Jones struggled, dropping more than 2% and ending a five-week winning streak. It slipped over 900 points below the 40,000 mark it had hit just last week. Meanwhile, the NASDAQ performed well, gaining over 1%, largely thanks to strong showings in the tech sector. The S&P 500 saw a modest increase (FactSet).
The tech sector was a standout, posting a 3.4% gain. This sector's success is part of a trend of strong earnings, with tech companies showing the third-highest earnings growth among the 11 sectors of the S&P 500? (FactSet Insight)?.
Oil prices also saw a decline, dropping around 2% to their lowest level in more than three months. This drop was influenced by an increase in U.S. crude inventories. By Friday afternoon, oil was trading below $78 per barrel, a significant decrease from the high of $87 we saw in early April. This is welcome news as high energy prices have been one of the primary buoys to inflation both directly and indirectly.
As of Friday, most of first-quarter earnings reports are in, companies in the S&P 500 are showing an average earnings increase of 6.0% compared to last year. If this holds, it will be the best growth rate since the first quarter of 2022. This positive trend indicates that many companies are adapting well to the current economic challenges? (FactSet Insight)?? (markets.businessinsider.com)?.
Looking Ahead
This week is packed with important economic reports, even though it’s shortened by the Memorial Day holiday. On Tuesday, keep an eye on the Consumer Confidence, which will give us a sense of how consumers are feeling about the economy and their spending plans.
Thursday is a big day with the release of the updated U.S. GDP estimate. The initial estimate from late April suggested that GDP grew at an annual rate of 1.6% in the first quarter, down from 3.4% in the fourth quarter of last year. Any changes to this figure will be closely watched. We’ll also get the weekly unemployment claims report from the Department of Labor, giving us more insight into the job market.
On Friday, the spotlight will be on inflation with the Personal Consumption Expenditure (PCE) Price Index from the Bureau of Economic Analysis. This is a key measure of inflation and one that the Federal Reserve closely monitors when making decisions about interest rates.
As always, if you have any questions or concerns about your investments or what’s happening in the economy, don’t hesitate to reach out to me by phone or email. I'm here to help you navigate these times.
Take care and enjoy your week!
Best regards,
Jeremy Raffer, MBA
Director & Wealth Manager
Author “Financial Planning for Widows”
m. 201-747-2705
e. jeremy.raffer@stewardpartners.com
Steward Partners
115 W. Century Rd, Suite 145
Paramus, NJ 07652
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