 | AUTHOR: Jason Roque, CFP®, APMA®, AWMA® TITLE: Investment Adviser Rep – CCO TAGS: S&P 500, NASDAQ, Nvidia, Banks, FRB |
There was green on the screen for the first time in August! Will it continue or was this a flash in the pan?
Monday S&P 500 0.69% | NASDAQ 1.56%
Markets pushed higher to open the week. Led by the chip sector in anticipation of Nvidia earnings due out on Wednesday. There was little on the economic calendar for the day, allowing markets to look ahead.
Tuesday S&P 500 0.28% | NASDAQ 0.06%
Equity markets opened in the green but faded as it went through the day. S&P downgraded several banks pushing markets lower. The main banks affected were regional banks with lower yields. The return of high yield savings caused oversized outflows from some regional banks.
Wednesday S&P 500 1.11% | NASDAQ 1.59%
Markets surged throughout the day on Wednesday. It was an anticipatory move for Nvidia earnings due out after the bell. Nvidia has been the face of the AI movement that has been the center of markets attention for 2023.
Thursday S&P 500 1.35% | NASDAQ 1.87%
Durable goods orders came in stronger and initial unemployment claims came in weaker than expected. Markets posted losses offsetting the gains from Wednesday. This was likely a pre-emptive move based on FRB’s Powell speaking on Friday.
Friday S&P 500 0.67% | NASDAQ 0.94%
Markets opened much as they had closed on Thursday. Equities pushed higher as the day progressed. Consumer sentiment came in lighter and 5-year inflation expectations came in stronger than expected, but still rooted firmly at 3%. Weaker sentiment signals that a weaker consumer ahead would justify a lighter load when it comes to future rate hikes. The Federal Reserve Bank (FRB) Chair, J. Powell, spoke at Jackson Hole and continued his hawkish stance on monetary policy. This did not deter markets. Ultimately, markets closed in the green for the day and the week.
Conclusion S&P 500 0.82% | NASDAQ 2.26%
The markets rose for the week for the first time since July. Nvidia stole the earnings show on the week, but unfortunately the FRB always steals the whole show. The Hawkish tone from the FRB sent a message that at least one rate hike should be expected shortly. The short-lived momentum from Nvidia will likely be just that. In the near-term a hawkish FRB will persist longer than an earnings report.
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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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FOR MORE INFORMATION:
If you would like to receive this weekly article and other timely information follow us, here.
Always remember that while this is a week in review, this does not trigger or relate to trading activity on your account with Financial Future Services. Broad diversification across several asset classes with a long-term holding strategy is the best strategy in any market environment.
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.