Weekly Market Insights: Fed Comments Stir the Pot for Stocks

Weekly Market Insights: Fed Comments Stir the Pot for Stocks

Stocks dropped last week as investors focused on “what’s next” for interest rates after mixed comments from multiple Fed officials.

Fed Officials Weigh In

Stocks struggled out of the gate again last week, ending Monday and Tuesday in the red on concerns that recent economic data could derail the Fed’s plan for short-term rates.

The markets recovered Wednesday through Thursday morning when weekly jobless claims were better than expected. But stocks fell broadly Thursday afternoon following mixed comments from multiple Fed officials. All three averages ended the day down more than 1 percent for the first time in a month.1,2

On Friday, a strong jobs report gave investors much-needed confidence. The U.S. economy created 303,000 jobs in March—higher than economists’ expectations—while unemployment dropped slightly to 3.8 percent. Markets rallied after the news, but not enough to recoup all weekly losses.3

What’s the Scoop?

Several Fed officials made speeches last week, including Chair Jerome Powell. In a Wednesday speech at Stanford University, Powell said it was a “bumpy” path to a soft landing, but Fed officials are continuing to look at the long-term trends.4

Last week, Atlanta Fed President Raphael Bostic suggested one cut. San Francisco Fed President Mary Daly noted no guarantees, and Cleveland’s President Loretta Mester said rate cuts may come later this year. Minneapolis President Neel Kashkari rattled markets by suggesting that no cuts may be on the table, followed by Fed Governor Michelle Bowman, who said on Friday that it’s possible rates may have to move higher to control inflation.5,6

The flurry of comments comes following the end of the Fed’s blackout period. Fed officials are not allowed to make public comments except for very narrow windows during the year.

This Week: Key Economic Data

Tuesday: NFIB Small Business Optimism Index.

Wednesday: Consumer Price Index (CPI). FOMC Minutes. EIA Petroleum Status. Treasury Statement.

Thursday: Jobless Claims. Producer Price Index—Final. Fed Balance Sheet. EIA Natural Gas Report.

Friday: Import and Export Prices. Consumer Sentiment.

Source: Investors Business Daily – Econoday economic calendar; April 2, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

This Week: Companies Reporting Earnings

Tuesday: Albertsons Companies, Inc. (ACI)

Wednesday: Delta Air Lines, Inc. (DAL)

Thursday: The Progressive Corporation (PGR), Infosys (INFY), Constellation Brands Inc (STZ)

Friday: JPMorgan Chase & Co. (JPM), Wells Fargo & Company (WFC), BlackRock, Inc. (BLK), Citigroup Inc. (C), State Street Corporation (STT)

Source: Zacks, April 2, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

“Always it’s spring and everyone’s in love and flowers pick themselves.”

– E.E. Cummings

Reporting Cash Payments

Are you expecting a little extra cash from a gift or sale? The IRS would like to know. Individuals, corporations, and partnerships must report cash transactions of more than $10,000.

These cash payments can include jewelry sales, a gift from a family member, an overseas purchase, or any other cash transaction. You also need to report cash payments received in one lump sum, in two or more related payments within 24 hours, or as part of a single transaction or two or more transactions in the last year.

File Form 8300, titled Report of Cash Payments Over $10,000 Received in a Trade or Business. This form requires information about the benefactor and the recipient of the cash, a description of the transaction, and information about any other parties involved.

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov7

The Health Benefits of a Meat-Free Day

The overwhelming health benefits of a plant-based diet are clear, but becoming entirely vegetarian or vegan is not for everyone. Luckily, one can still enjoy many health benefits by being “meat-free” for just one day per week. Here are some of the main benefits of this healthy lifestyle transition:

  • You’ll be reducing your consumption of potentially dangerous processed meat—According to the World Health Organization, processed meats rank alongside cigarettes as a major cause of cancer.

  • You’ll decrease your risk of heart disease—Coronary heart disease is linked to a meat-based diet, and most cardiovascular diseases can be prevented by switching to a plant-based diet.
  • You’ll be ingesting more vitamins, minerals, and fiber—On your meat-free days, you will likely prioritize other foods such as veggies, fruits, whole grains, and other plant-based products. This variety will help you round out your diet.

These are merely a few benefits of being meat-free for a day. Want more inspiration? Google “Meatless Monday” for recipe suggestions.

Tip adapted from MindFood.com8

You have 31 baseballs in a box, and 31 kids are lined up to get them. You give each kid a baseball, but in the end, one baseball remains in the box. How is this possible?

 

Last week’s riddle: They have not flesh, nor feathers, nor scales, nor bone. Yet they have fingers and thumbs of their own. What are they? Answer: Gloves.

Fira de Barcelona, Barcelona, Spain

 

Footnotes and Sources

1. The Wall Street Journal, April 5, 2024

2. The Wall Street Journal, April 4, 2024

3. The Wall Street Journal, April 5, 2024

4. CNBC.com, April 3, 2024

5. CNBC.com, April 5, 2024

6. CNBC.com, April 5, 2024

7. IRS.gov, May 17, 2023

8. MindFood.com, January 23, 2023

Weekly Market Insights: Fed Comments Stir the Pot for Stocks

Weekly Market Insights: Stocks Narrowly Higher

Stocks were narrowly higher for the week as investors digested mixed economic news about consumer confidence. All three of the major averages posted gains for Q1 2024.

Stocks Finish Strong

Markets slipped for the first half of the four-day week as investors took a breather after the prior week’s gain. Conflicting economic news on Monday and Tuesday contributed to the slide. New home sales in February slipped 0.3 percent over the prior month but increased by 5.9 percent from the prior year. Durable goods orders—everything from washing machines to helicopters—rebounded 1.4 percent in February, beating expectations and recouping some of January’s 6.9 percent drop.1,2,3

Stocks rallied on Wednesday, including a fresh record close for the Standard & Poor’s 500. An upward revision to consumer sentiment on Thursday helped the rally along. The markets are closed on Friday when the much-anticipated inflation report called the Personal Consumption and Expenditures (PCE) is released, which could set up a volatile Monday.4

Doubters & Believers

Getting a straightforward read on consumers this week was challenging. The Conference Board reported on Tuesday that its Consumer Confidence Index remained essentially unchanged—as it has for the past six months—showing consumers were generally pessimistic about the future.

But on Thursday, the University of Michigan’s consumer-sentiment survey showed consumer confidence hit a 2½-year high in March. It suggested that consumers had gained more confidence that inflation would drop and alleviate some pressure on household finances. Friday’s PCE report may give some additional insights into consumer confidence.5,6

This Week: Key Economic Data

Monday: ISM Manufacturing Index. PMI Manufacturing Final. Construction Spending.

Tuesday: Motor Vehicle Sales. Factory Orders. JOLTS.

Wednesday: ADP Employment Report. EIA Petroleum Status Report. ISM Services Index.

Thursday: Jobless Claims. International Trade in Goods & Services. Fed Balance Sheet. Natural Gas Report.

Friday: Employment Situation. Consumer Credit.

Source: Investors Business Daily – Econoday economic calendar; March 27, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

This Week: Companies Reporting Earnings

Tuesday: Paychex, Inc. (PAYX)

Wednesday: Levi Strauss & Co. (LEVI)

Thursday: Conagra Brands (CAG)

Source: Zacks, March 27, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

“Be courteous to all, but intimate with few.”

– George Washington

IRS Offers Free Tax Prep Option for Military Personnel 

Each year, the Internal Revenue Service takes a moment to remind active duty military personnel that the “IRS Free File” offers them multiple choices for free federal tax preparation.

“The IRS takes special steps to help military members and their families with their taxes, and the Free File program is part of that effort,” said IRS Commissioner Chuck Rettig. “Almost 10% of the IRS workforce are veterans. We greatly appreciate the service to the nation of every veteran and their supportive families, and we will do all we can to assist them.”

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov7

Yoga for Stability

You don’t have to pull out the yoga mat and get your designer leggings on to enjoy this relaxing practice’s many benefits. Even if you’ve never done yoga before, these poses may help you improve your balance and stability:

  • Knee to chest: Start by standing with your feet hip-width apart and your hands on your hips; this is called mountain pose. Now, lift your left knee to hip height so your upper leg (thigh) is parallel to the floor. Flex your left foot and hold this pose for three deep breaths. Repeat on the other side.
  • Tree pose: Start with the same mountain pose as the first movement. Now, shift your weight into your left foot and allow your right knee to turn out to the side as you bring your right foot in to rest at your left ankle, shin, or thigh, depending on what’s comfortable. Make sure you’re not putting your foot directly on a joint.
  • Dancer pose: Start in mountain pose. Bend your right knee and slowly lift your right foot off the ground. As you do that, lift your left arm to balance yourself. Hold for three breaths and repeat on the other side.

Tip adapted from SilverSneakers.com8

They have not flesh, nor feathers, nor scales, nor bone. Yet they have fingers and thumbs of their own. What are they?

 

Last week’s riddle: Which positive whole number can you add 1.5 to and get the same result as multiplying it by 1.5? Answer: 3.

Nauta, Loreto, Peru

 

Footnotes and Sources

1. The Wall Street Journal, March 28, 2024

2. CNBC.com, March 25, 2024

3. Reuters, March 26, 2024

4. CNBC.com, March 26, 2024

5. MarketWatch.com, March 28, 2024

6. The Conference Board, March 26, 2024

7. IRS.gov, October 23, 2023 

8. SilverSneakers.com, December 21, 2023

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