If the currency (US Dollar) turns lower, it may mean inflation is cooling – and improved conditions for U.S. investors and companies.” - J.P. Morgan Insights
Last week's market recap:
- The S&P 500 closed the week down -.09%. Year-to-date the index is up 8.21%
- NASDAQ closed the week down -.42%%. YTD the index is up 15.64%
- U.S. Aggregate Bond index was down -.23% for the week. YTD the index is up 2.73%
- 10-Year Treasury Rate increased, ending the week at 3.57% up from 3.52% the prior week.
- Fed Funds Target rate is currently 4.75-5.00%
- The 1-Year Treasury is yielding 4.76%
- A 6 Month Treasury is yielding 5.06%
The week ahead:
- Earnings (Big Tech: Microsoft, Alphabet, Meta, Amazon. Others: Boeing, UPS, Verizon, Exxon, Chevron, etc.)
- Pending Home Sales
- Preliminary Q1 GDP
- Personal Consumption Expenditures (PCE) The Fed’s preferred inflation gauge
We’ve seen a rebound in stocks and bonds over the past six months. This seems to be supported by:
- Inflation heading in the right direction.
- The banking “crisis” seems to have turned out to be much less threatening than originally feared.
- The expected path of rate hikes has dropped.
- U.S. dollar weakening: The dollar tends to weaken once the Fed pivots back toward more accommodative policy, and the rest of the world grows in tandem.
All of these have contributed to a general bullish sentiment that has been reflected in most asset classes; however, earnings, economic data, and the debt ceiling ahead could increase volatility before a new bull market emerges. For long-term investors, diversification remains extremely important.
As always, let us know if you have any questions.
CRA Investment Committee
Matt Reynolds CPA, CFP®
Tom Reynolds, CPA
Robert T. Martin, CFA, CFP®
Gordon Shearer Jr., CFP®
Jeff Hilliard, CFP®, CRPC®
Joe McCaffrey, CFP®
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