Markets grew for the week for the first time in a month. Is it a reason to celebrate or a breather in the pullback?
Monday S&P 500 0.87% | NASDAQ 1.11%
Nine major companies reported earnings, with two missing expectations. Equities jumped to open the week. Outside of earnings data there was not much to support the rally. It was likely a jump on three consecutive weeks of down market, creating better by opportunities.
Tuesday S&P 500 1.20% | NASDAQ 1.59%
35 major companies reported earnings, with five missing expectations. Housing data came in better than expected. The heavy earnings data drove markets higher on Tuesday, pun intended. GM (GM) and Tesla (TSLA) were among reporters that helped propel markets.
Wednesday S&P 500 0.02% | NASDAQ 0.10%
40 major companies reported earnings, with six missing expectations. Core durable goods orders came in lighter than expected. Strong earnings data was counter-balanced by higher rate expectations. This left markets fairly unchanged.
Thursday S&P 500 0.46% | NASDAQ 0.64%
60 major companies reported earnings, with 13 missing expectations. GDP grew at a much slower pace than expected(1.6% vs 2.5%). Unemployment data continued to show strength. GDP and forward guidance from Meta (META) spooked markets early. They managed to climb halfway out of the hole that was dug as the earnings flowed in throughout the day.
Friday S&P 500 1.02% | NASDAQ 2.03%
13 major companies reported earnings, with five missing expectations. Consumer sentiment softened in April. Core Personal Consumption Expenditures (PCE) held steady at 2.8% in March. This is the Federal Reserve Board’s (FRB) preferred gauge of inflation. Between PCE data and earnings from Alphabet (GOOG) and Microsoft (MSFT) markets surged on the day.
Conclusion S&P 500 2.67% | NASDAQ 4.23%
The markets experienced a strong bounce back this last week in comparison to the last three weeks. Do not be fooled. Markets have a way to go to recapture highs as the growth did not even recover from the prior week. This indicates that there is room for markets to continue the run up as earnings season wears on. There are major hurdles this coming week with the FRB meeting, Jobs data, and Apple (AAPL) reports earnings.
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Last week felt like Opposite Day. Will this continue or will data begin to be better represented on the markets?
Monday S&P 500 3.20% | NASDAQ 4.29%
Markets tumbled to open the week. The elevated volatility makes the day’s move far too common. The interesting move on the day was that it was a red day for most sectors. Equities and oil will contradict each other typically, however, they all fell on the day. The 2-year and 10-year yields both fell for the day (Yields and prices move in opposite directions). It what appear to be a safe haven bid for markets.
Tuesday S&P 500 0.25% | NASDAQ 0.98%
The day started firmly in the green as markets attempted to rebound losses from Monday. Those faded as the day wore on, but markets did remain in the green. Also making gains, was treasury prices as yields fell slightly.
Wednesday S&P 500 1.65% | NASDAQ 3.18%
Consumer Price Index (CPI) data came out on Wednesday. It showed that inflation softens slightly year over year, but less than was expected. The resilience of inflation will likely mean the aggressive nature of the Federal Reserve Board (FRB) should continue.
Thursday S&P 500 0.13% | NASDAQ 0.06%
Jobs data showed continued strength in the job market, to no one’s surprise. Additionally, the Producer Price Index (PPI) showed corporate inflationary pressure is persisting. PPI measures input costs for companies and is often a tell on if consumers should expect retail prices to rise. Markets were little changed on the day.
Friday S&P 500 2.39% | NASDAQ 3.82%
Markets rallied broadly on Friday. This was in spite of Consumer Confidence coming in weaker than expected. It is not surprising, as a weaker consumer creates less inflationary pressure. Less inflationary pressure means less cause for the FRB to be more aggressive on rates.
Conclusion S&P 500 2.41% | NASDAQ 2.80%
My kids like to play opposite day quite frequently. Yeah Dad, I cleaned my room… nope… Yeah Dad, I emptied the dish washer… really… Apparently, the stock market is taking a lesson from my kiddos. Good economic data, while good for the economy, signals a more aggressive FRB which will hurt future earnings prospects. Bad economic data, while bad for the economy, signals a more restrained FRB and therefore bodes well for future earnings. Look for opposite day to last the next year or so…
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Any and all third-party posts or responses to this blog do not reflect the views of the firm and have not been reviewed by the firm for completeness or accuracy.