Weekly Market Update - Trust Point

Weekly Market Update

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Weekly Market Update:

Each week we will offer a very brief market update to help keep you informed on the latest. Want the latest delivered right to your email? Click HERE to provide your email address.

Market Updates

Week of June 10, 2024 – Markets were mixed for the week as global stocks rose 0.50%, and international stocks fell 1.48%. In the U.S., large-cap stocks closed 1.62% higher, and small-cap stocks declined 0.95%. Fixed income markets showed strong returns with U.S. and international bonds closing 1.31% and 0.66% higher, respectively. Bonds rallied as May inflation data from the CPI (Consumer Price Index) and PPI (Producer Price Index) were lower than anticipated, which caused lower U.S. bond yields. This data increased the likelihood of interest rate cuts as well, and markets now see an 80% probability of two cuts by the end of the year. Although cuts seem more likely, there have been no changes yet as the FOMC kept interest rates constant after meeting this week. Looking at the week ahead, economic data from U.S. retail sales will come on Tuesday, and various housing data will be released Wednesday through Friday. This will also be a shortened week for markets with the Juneteenth holiday on Wednesday.

Week of June 3, 2024 – Global stocks climbed 0.89%, and international stocks closed 0.20% higher. In the U.S., large-cap stocks led the way once again with a 1.36% gain, while small-cap stocks fell 2.07%. In fixed income markets, U.S. and international bonds closed 0.44% and 0.46% higher, respectively. U.S. services bounced back with May’s ISM number jumping to 53.8%, which indicates expansion for the sector. This month’s job report also showed strength as more jobs were created than expected, and hourly wages climbed 0.4%. Because of this positive economic data, the probability of earlier interest rate cuts declined. Investors now see the first cut potentially coming in September, with a 54% probability. Looking at the week ahead, CPI (Consumer Price Index) and PPI (Produce Price Index) inflation data will be released on Wednesday and Thursday. The Federal Reserve will also make an official interest rate decision on Wednesday.

Week of May 27, 2024 – It was a mixed week for markets as global and international stocks closed 0.63% and 0.65% lower, respectively. In the U.S., large-cap stocks fell 0.49%, but small-cap stocks rose 0.04% higher. For fixed income markets, U.S. bonds closed 0.04% higher, while international bonds declined 0.14%. When adjusted for inflation, consumer spending fell slightly in April. Also, pending home sales dropped significantly for the month (-7.7%). Higher interest rates and high mortgage payments are trickling down and starting to put pressure on the consumer. Coming this week, ISM manufacturing and services data will help show the current state of U.S. businesses. On Friday, investors can also look for the May jobs report, which displays key labor market data.

Week of May 20, 2024 – Global stocks fell 0.38%, and international stocks closed 1% lower for the week. In the U.S., large-cap stocks squeaked out a +0.05% return, while small-cap stocks dropped 1.21%. For fixed income, U.S. and international bonds closed 0.28% and 0.30% lower, respectively. On Wednesday, Nvidia beat earnings estimates once again and continued its dominance in the AI space. Also, the U.S. economy continues to show solid growth as S&P surveys for services and manufacturing showed businesses are optimistic about future growth. This week, economic data will pick back up with April’s personal income and expenditures report highlighting the week. This report is released on Friday and includes inflation data from the PCE index, an index closely monitored by the Federal Reserve.

Week of May 13, 2024 – Another positive week for markets as global and international stocks climbed 1.74% and 1.93% higher, respectively. In the U.S., large-cap stocks rose 1.6%, and small-cap stocks closed 1.79% higher. For fixed income, U.S. and international bonds were 0.57% and 0.20% higher, respectively. The consumer price index slowed slightly from the previous month to a +0.3% change in April. This rise remains above the Federal Reserve’s 2% annual inflation target, but it shows progress is being made. In other news, OpenAI and Google have recently presented new artificial intelligence models that keep investors hopeful for the future of companies related to AI technology. This week, Microsoft is expected to display its newest AI developments relating to Windows PCs. Also, the $2.3 trillion AI giant Nvidia will release its quarterly earnings on Wednesday.

Week of May 6, 2024 – Global stocks rose 1.66%, and international stocks closed 1.35% higher. In the U.S., large-cap and small-cap stocks climbed 1.89% and 1.21%, respectively. For fixed income, U.S. bonds closed 0.09% higher, and international bonds rose 0.12%. Most companies have now released their first-quarter earnings reports. Overall, results have been positive but skewed for larger firms. Large-cap companies were generally positive and saw the strongest numbers. However, small caps had weaker earnings and profits for the quarter, which gives reason for their lower returns so far this year. It was a slower week for economic data, but initial jobless claims were slightly above expectations. Investors will continue to monitor labor market data as potential interest rate cuts are on the table. Looking ahead, economic data ramps back up with monthly prints from the Consumer Price Index (CPI) and Producer Price Index (PPI) on Tuesday and Wednesday this week.

Week of April 29, 2024 – It was an all-around positive week for markets to start the month. Global stocks closed 0.97% higher, and international stocks rose 1.66%. In the U.S., large-cap and small-cap stocks climbed 0.56% and 1.71%, respectively. For fixed income, U.S. bonds were up 1.17%, and international bonds closed 0.41% higher. The Federal Reserve kept interest rates unchanged on Wednesday, as expected by investors. April labor market data showed softer results for the U.S. with fewer jobs created and higher unemployment than expected. This brought interest rates lower and stocks higher because a weaker labor market led investors to believe that earlier (and more) interest rate cuts are more likely. So far, the majority of companies have reported Q1 earnings and the largest firms have posted the strongest results. However, there are still key companies that have yet to report their Q1 results. This upcoming week, Walt Disney, Reddit, Uber, Airbnb, and Warner Bros are among notable companies.

Week of April 22, 2024 – Stock markets rebounded during the week, with global and international stocks both rising 2.75%. In the U.S., large-cap stocks closed 2.68% higher, and small-cap stocks climbed 2.80%. For fixed income markets, U.S. bonds closed 0.08% lower, and international bonds fell 0.25%. Like last week, large technology companies contributed significantly to the movement in markets. But this time, on the upside after strong earnings from companies such as Alphabet and Microsoft. Looking at economic data, the Personal Consumption Expenditures Price Index (PCE) posted in line with expectations for March, but it remained above the Federal Reserve’s 2% annual inflation target. Additionally, Q1 GDP posted a value of +1.6%, but it was slightly below investors’ expectations. Looking at the next week, earnings reports continue with Apple, Amazon, McDonald’s, Berkshire Hathaway, and other companies reporting their quarterly results. Key labor market data will be released, and the Federal Reserve will also be providing an interest-rate decision.

Week of April 15, 2024 – Markets continued a weaker month as global stocks closed 2.68% lower, and international stocks fell 1.85%. In the U.S., large-cap and small-cap stocks were 3.04% and 2.76% lower, respectively. For fixed income markets, U.S. bonds closed 0.61% lower, and international bonds fell 0.34%. Large, technology stocks significantly contributed to the market decline, and bond yields moved higher throughout the week. This is related to investors expecting high interest rates for longer. For quarterly earnings, Q1 growth is on pace to be flat over the past twelve months for companies, on average. More information will come in the next few weeks as about 30% of the S&P 500 will report earnings in the coming week. Notable companies include Tesla, General Motors, Meta Platforms, Microsoft, Alphabet, and Exxon Mobil. Also, Q1 GDP and key inflation data will be released in the week ahead.

Week of April 8, 2024 – Global stocks fell 1.72% lower, and international stocks closed 2.03% lower for the week. In the U.S., large-cap and small-cap stocks were 1.52% and 2.91% lower, respectively. In fixed-income, U.S. bonds closed 0.70% lower, and international bonds had no change. March inflation numbers led markets lower as monthly prices rose above expectations. The annual inflation value also remained above the Fed’s 2% target rate. This led investors to believe that interest rates will remain higher for longer to slow down inflation and economic growth. Looking at the week ahead, monthly housing and retail sales economic data will become available. Also, various companies will release quarterly earnings including Goldman Sachs, Bank of America, UnitedHealth, Netflix, and Taiwan Semiconductor.

Week of April 1, 2024 – Overall, markets had a weaker week to start the month of April. Global stocks fell 0.76%, and international stocks closed 0.46% lower. In the U.S., large-cap stocks dropped 0.93%, and small-cap stocks were 2.86% lower. For fixed-income markets, U.S. and international bonds closed 1.06% and 0.39% lower, respectively. Although market returns were negative, the U.S. saw generally positive economic data during the week. First, ISM manufacturing and services indices both reported March values that indicate expansion in the US economy. Also, the March jobs report indicated strength in the labor market as over 50% more jobs were created than expected. With stronger economic data, investors continue to predict less interest rate cuts for 2024 because the Fed may have to keep interest rates more restrictive for longer to slow down the economy and bring inflation down to their 2% annualized target. Two different inflation indicators (the CPI & PPI) will release their March values in the coming week, and investors will keep a keen eye on this data.

Week of March 25, 2024 – It was a shorter week for markets with the Good Friday holiday. Global stocks climbed 0.37% higher, and international stocks closed 0.33% higher for the week. In the U.S., large-cap stocks finished 0.40% higher, and small-cap stocks rose 2.60% higher. For fixed income markets, U.S. and international bonds closed 0.23% and 0.19% higher, respectively. The Personal Consumption Expenditures Price (PCE) Index, an inflation measure highly monitored by the Federal Reserve, displayed an expected 0.3% increase in February. This brings the inflation rate to 2.5% over the past 12 months, remaining above the Fed’s 2% target. In other news this week, initial jobless claims were slightly below expectations, and the second revision of Q4 GDP was above expectations at 3.4%. This data continues to follow the recent trend of stronger-than-expected employment and economic growth despite higher interest rates. Looking to next week, investors are anticipating a slew of economic data including ISM manufacturing, ISM services, and culminating with the March jobs report released on Friday.

Week of March 18, 2024 – Global stocks closed 1.77% higher for the week, and international stocks rose 0.81%. In the U.S., large-cap stocks led the market with a 2.31% return, and small-cap stocks climbed 1.61%. For fixed income, U.S. and international bonds closed 0.73% and 0.56% higher, respectively. The Federal Reserve kept interest rates steady on Wednesday, and the FOMC Chair Jerome Powell reiterated that they expect economic conditions to provide an opportunity for rate cuts later this year. Housing data released during the week showed an increase in the supply of new homes and a rebound in housing starts as well as building permits in February. However, home prices remain relatively high with strong demand and elevated home sales. Looking ahead, the Fed’s preferred inflation measure (Personal Consumption Expenditures Price Index) will print February’s data on Friday.

Week of March 11, 2024 – Markets were lower for the week as global stocks fell 0.23%, and international stocks closed 0.36% lower. In the U.S., large-cap stocks were 0.09% lower, and small-cap stocks dropped 2.02%. For fixed income, U.S. bonds closed 1.23% lower, and international bonds fell 0.60%. On Tuesday and Thursday, inflation data showed that prices are rising above the Federal Reserve’s target and median expectations. This led bond yields higher as investors are expecting interest rate cuts to be pushed farther into the future. Talks of potential interest rate cuts will continue this week as the FOMC releases its March interest rate decision on Wednesday. Also, home builder confidence, housing starts, and existing home sales monthly data will be released this week, giving insight into the current status of the housing market.

Week of March 4, 2024 – Global stocks ended the week 0.30% higher, and international stocks rose 1.22%. In the U.S., large-cap stocks fell 0.23%, and small-cap stocks closed 0.34% higher. For fixed income, U.S. bonds rose 0.81%, and international bonds were up 0.70% to end the week. Also, Bitcoin’s rally continues as it can now trade in exchange-traded products in the U.K. The cryptocurrency’s level is now above $72,000. On Friday, jobs data showed strength as more jobs were created in February than expected. However, the Federal Reserve remains cautious in cutting interest rates and continues to monitor inflation and the labor market with hopes of performing a soft landing. Along with the Federal Reserve, investors will be watching inflation data that is released this week. The Consumer Price Index (CPI) and Producer Price Index (PPI) will be printed on Tuesday and Thursday, respectively.

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