The Major Markets ended the week lower with losses in all five indices. The Nasdaq saw the greatest losses as the Tech index felt the pain of a loss in conviction to the buy side of the market last week. For the S&P 500, the market opened soft with the market trading largely sideways after the initial open with no economic reports or material headlines to significantly steer the direction of the markets. On Tuesday, the markets opened slightly lower once again, but the day was marked by comments from Jerome Powell “The reality is if we continue to get strong labor market reports or higher inflation reports, it might be the case that we have to raise rates more" This was referencing the prior week’s January Payrolls report which significantly beat estimates with a reading of 517,000 new jobs compared to the 187,000 expected. Ultimately, the initial spike and sell-off resolved into a late day surge into the highs at the close. Yet, as the week wore on, the selling resumed, and the weekly gains proved to be short-lived as the S&P 500 traded lower Wednesday and Thursday with minor gains Friday. For treasuries, the week’s activity saw the yield curve rise higher with higher yields in each of the various durations. This pulled on the bond indices. For the Bloomberg Barclays Us Aggregate Bond index, this signified another loss of 1.43% for the week. At Leap Wealth, we are here to help our clients manage through all the highs and lows. Contact us today to learn more.
The major markets closed last week with mixed gains in the Nasdaq, S&P 500 and the MSCI World Index. Meanwhile, the Dow Jones Industrial average and the MSCI Emerging Markets index closed out the week lower. Market Analysts waited with expectation and trepidation ahead of the midweek FOMC meeting. The expectation going into the week was that the Fed would raise the Fed Funds rates by 25 basis points after a year filled with 75 and 50 basis point increases. This placed the Fed Funds Rate at 4.5 to 4.75% and took interest rates to their highest level since the fall of 2007. While these rates feel high relative to the trailing 5 and 10-year averages, this places the Target range right around the historical average of 4.6%, dating back to 1954. The week continued with even greater gains Thursday and losses Friday which bookended the week’s daily sessions. Despite the increase in the Fed Funds Rates, Treasuries remained effectively unchanged from the prior week. The various bond indices also remained fairly stable with the noteworthy gains in the high yield segments. Contact us today to learn more about how we can help you. www.leapwealth.com
The Major Markets resumed their upward trek last week with gains in all five indices. The Nasdaq led the pack higher as it outperformed the other 4 indices by double the weekly returns in some cases. For the Nasdaq, last week’s gains were noteworthy, not just because of the four and a third percentage point gain, but for what that gain as of Friday’s close did. For the first time since January of last year, the Nasdaq managed to close the day above its 200-day moving average. This is viewed as a key technical level for many that utilize technical analysis. Whether the market manages to climb higher off the December lows or resumes the downward fall, time will tell. But for the time being, analysts were celebrating this start of the year as the best beginning for the Nasdaq since 2001. The FOMC will be meeting again this week and the CME Group FedWatch Tool has a 25-basis point increase to the Fed Funds Rate priced as a near certainty. However, the upcoming meetings in March, May, and June look far more uncertain but the consensus is that the Fed is nearing the end of their rate increases for the time being. Wednesday saw initial weakness following Microsoft’s disappointing fiscal Q3 outlook as earnings season caused a number of high-profile companies’ results to play on the greater market’s optimism. At the sector level, only Health Care and Utilities closed lower. The gains were widespread across the 9 other sectors. Not surprisingly, the segments that form the larger components of the Nasdaq saw the greatest gains. Contact us today to learn more about how we can help you www.leapwealth.com
After two solid weeks of gains, the Major Markets began to experience some choppiness in the new year with the markets closing the week mixed. The greatest losses were in the Dow Jones Average as the fourth quarter earnings results for Goldman Sachs and the forecast for Travelers Insurance weighed heavily on the index. Conversely, Netflix’s positive earnings results coupled with the stepping down of its CEO saw the stock as well as the larger communication services sector climb higher after hours Thursday. This gave the S&P 500 a much needed boost at the end of the week which helped the index to recover much of the earlier losses. Communication Services was the standout performer of the various segments of the S&P 500 last week. Energy and Information Technology also managed to close positive at the end of the 4 daily sessions. Meanwhile, losses in Industrials, Utilities, Consumer Staples, and Financials weighed the heaviest on the broader index. The economic calendar held several reports that pointed to a cooling economy and gave investors optimism that inflation was continuing to subside. The Produce Price Index came in lower than expected with a month over month decline of 0.5%, marking the biggest monthly decline since April 2020. Retail Sales also came in lower than expectations as the ongoing impact of inflation was causing sales to drop, slowing consumer’s spending. Analysts highlighted that rising credit card balances and interest rates as well as rising auto loan rates were impacting demand. Contact us today to learn more about how we can help you. www.leapwealth.com
The strength of the new year continued into the first full week of 2023. The gains were the greatest in the Nasdaq but closely followed by the Emerging Market Index. While the Santa Clause rally was nowhere to be seen in December, the weekly performance has been progressively improving relative to the week ending December 9th. On Thursday, the Consumer Price Index reflected a year-over-year increase of 6.5% and was largely in line with expectations and cooler than recent months. This was also the case while the weekly jobless claims report which showed a reduction in the continuing jobless claims and a lower reading of the initial claims. However, on Friday, Treasury Secretary Janet Yellen wrote in a letter to Congress that the debt ceiling would hit this Thursday. The last time the government had approached the debt ceiling, congress increased the debt limit to approximately $31 trillion back in December of 2021. This presents a challenge for both congress and the markets as the Federal Reserve is trying to rein in inflation while the Treasury needs to further kick the proverbial can down the road, all at a time when congress is highly divided. Nevertheless, the markets seemed to shrug off this news initially as only Monday saw a negative daily session last week. This week will see earnings season begin to ramp up as the fourth quarter 2022 numbers will begin to hit the street and talk in Washington will begin to focus more on the debt ceiling. Contact us today to learn more about how we can help you www.leapwealth.com