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Recap | Week Ahead | U.S. Consumer Thumbnail

Recap | Week Ahead | U.S. Consumer

Historically, whenever the S&P 500 is up at least 10% year-to-date as of the end of June, the index ended the year higher 82% of the time, gaining 7.7% on average.  - Research from the Carson Group *

Last week's market recap: 

  • The S&P 500 closed the week down -1.37%.  Year-to-date the index is up 14.19%
  • NASDAQ closed the week down -1.43%.  YTD the index is up 29.47%
  • U.S. Aggregate Bond index was up .14% for the week.  YTD the index is up 2.36%
  • 10-Year Treasury Rate increased, ending the week at 3.74% down from 3.77% the prior week
    • Fed Funds Target rate is currently 5.00-5.25%
  • The 1-Year Treasury is yielding 5.28%  
  • A 6 Month Treasury is yielding 5.43%  


The week ahead:  

  • Q1 GDP (Gross Domestic Product)
  • Consumer Confidence Index
  • PCE Index – The Fed’s preferred inflation gauge
  • Housing Market data


How is the consumer doing?

For now, the U.S. consumer is still doing fairly well.  Yes, consumer confidence is low (bullish indicator), but the consumer balance sheet is still strong. 

According to JP Morgan, 66% of consumer liabilities is their mortgage and most mortgages are under 4%.  (At the end of 2022, 62% of mortages were below 4% and 82% were below 5%.)  So rate hikes aren’t directly affecting the consumer yet. 


Will student loans impact the consumer?  

Student loans will start again in September for roughly 13% of Americans, but this accounts for only 9% of consumer balance sheets.   

For now, and maybe longer than many expect, the U.S. consumer remains strong.


Institutional Mid-Year Market Forecasts are all over the map.  Short term yields are attractive again.  The end of rate hikes seem to be within sight.  Fundamentals are mixed.  Many Technicals are looking better.  Macro is always a concern.  This market is NOT boring.  Proper diversification remains extremely important as there are opportunities within Equities, Fixed Income, and Alternatives.     

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® 

Phillip Tompkins 


Source: * https://am.jpmorgan.com/us/en/asset-management/adv/insights/market-insights/guide-to-the-markets/  

Source: * https://www.carsongroup.com/wp-content/uploads/2023/06/Blog-2-Edit-1.png 

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