|AUTHOR: Jason J. Roque, MS, CFP®, APMA®, AWMA® |
TITLE: Investment Adviser Rep – CCO
TAGS: S&P 500, Stagflation, Debt Ceiling, Jobs
With a close eye on inflationary pressures, will the recovery continue as wanted or will they need help finding equilibrium?
Markets fell .25% on Monday as the week continued the losses from the prior week. The NASDAQ led the way lower as it has for the last couple of weeks. Although current housing statistics are lower, the NAHB housing index is holding steady at 83. Interest is there; however, material costs and a lack of inventory are stemming growth.
In a continued fall of market activity, the S&P 500 slid .85% Tuesday. The NASDAQ trailed the S&P 500 for a change during the fall. Both new housing starts and building permits fell in April. Lending to the pessimism about current economic conditions. This should yield a net gain as the reopening seems to be coming on slower than expected, quelling concerns about inflation.
The slide in market value this week continued with the S&P 500 falling .29% Wednesday. Again, the NASDAQ lagged the S&P 500 on the fall. Gold and interest rates gained on the day.
In an attempt to stage a rebound on the week, the S&P 500 rose 1.06%. The NASDAQ led the way as the dollar weakened and concerns over inflation seemed to subside. Most of the recovery trade on the day related to initial jobless claims coming in at 444K. This is the lowest level since the start of the pandemic and the third week in a row under 500K.
The S&P 500 was little changed on Friday. Both manufacturing and services PMI information improved from the prior month. Manufacturing experienced a minor increase, while services jumped dramatically.
The markets as a whole continue to gauge price increases against worker production to alleviate supply shortages. The question has been whether reentry into open employment opportunities would keep pace with consumer demand. Figures show that there continues to be a slow movement back into the workforce. New housing starts fell which reflects a slower recovery in this area. Housing data eased major inflationary concerns following the spike in the Consumer Price Index (CPI) figures from April. The .43% fall for the week was not much, but enough to keep the recent trend of weekly losses continuing.
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