Market Insights – April 17, 2023

The combination of an improving inflation outlook resulted in a week of uneven, albeit positive, performance, in which cyclical and financial stocks rallied while technology, real estate, and utilities lagged. 

The Dow Jones Industrial Average gained 1.20%, while the Standard & Poor’s 500 rose 0.79%. The Nasdaq Composite index increased 0.29% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, added 2.08%.^1,2,3

Inflation Retreat

Stocks treaded water ahead of last week’s inflation data and the start of a new earnings season. Stocks rallied on a favorable March consumer inflation report, only to falter after the release of last month’s Federal Open Market Committee (FOMC) meeting minutes, which hinted at a potential recession later this year.

After reports of a more pronounced slowdown in producer prices on Thursday, stocks surged higher, with technology and communication services companies leading the charge. A weak retail sales number on Friday shaved the gains to close out the week.

Trending Lower

Last week provided fresh insight into inflation, and the news was encouraging.

The Consumer Price Index (CPI) rose a very modest 0.1% in March, while the year-over-year increase in consumer prices was 5.0%, down from February’s 12-month rise of 6.0%. Declines aided the March report in groceries, gasoline, medical care, and utilities.⁴

The read on supplier prices was even more positive. The Producer Price Index (PPI), which many economists see as a signal of future consumer prices, declined 0.5%–the most significant monthly decline since 2020. The 12-month increase as of March was 2.7%, an easing from February’s year-over-year climb of 4.9%.⁵

This Week: Key Economic Data

Tuesday: Housing Starts.

Thursday: Jobless Claims. Existing Home Sales. Index of Leading Economic Indicators.

Friday: Purchasing Managers’ Index (PMI) Composite Flash.

^{Source: Econoday, April 14, 2023
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Monday: The Charles Schwab Corporation (SCHW), M&T Bank Corporation (MTB).

Tuesday: Netflix, Inc. (NFLX), Bank of America Corporation (BAC), Johnson & Johnson (JNJ), Lockheed Martin Corporation (LMT), The Goldman Sachs Group, Inc. (GS) .

Wednesday: Tesla, Inc. (TSLA), IBM Corporation (IBM), Lam Research Corporation (LRCX), Abbott Laboratories (ABT), Morgan Stanley (MS), U.S. Bancorp (USB), United Airlines Holdings, Inc. (UAL).

Thursday: AT&T, Inc. (T), Blackstone, Inc. (BX), American Express Company (AXP), CSX Corporation (CSX), Union Pacific Corporation (UNP), D.R. Horton (DHI), Truist Financial Corporation (TFC).

Friday: The Procter & Gamble Company (PG), HCA Healthcare, Inc. (HCA), Freeport-McMoRan, Inc. (FCX), Regions FInancial Corporation (RF).

^{Source: Zacks, April 14, 2023
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“We may encounter many defeats but we must not be defeated.”

– Maya Angelou

Recordkeeping Tips For Small Business Owners

As a small business owner, your recordkeeping is of utmost importance. These records show your income, expenses, business transactions, and much more. You can choose whatever recordkeeping system you want if you and the IRS have the necessary information.

As a business owner, you will need to keep track of supporting documents such as:

• Purchases
• Sales
• Payroll
• Sales slips
• Paid bills
• Invoices
• Receipts
• Deposit slips
• Canceled checks
• Travel, transportation, entertainment, and gift expenses
• Assets

Keeping your records well-organized will save you time, effort, and money.

*This information is not intended to substitute for specific individualized tax advice. We suggest you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁶

Take Time For Tea

Are you looking for a warm, cozy escape? Look no further than a cup of tea! A cup of chamomile tea even has some potential health benefits!

Here are just a few:

• May lower blood sugar in people with diabetes and may prevent blood sugar from spiking.
• May reduce inflammation
• May help with sleep and relaxation
• May help treat cold symptoms

Make time for tea!

Tip adapted from Medical News Today⁷

Two fathers and two sons shopped for computers at their local big box retailer. Each bought a PC, yet they purchased only three PCs in total. How could this be?

Last week’s riddle: I can’t walk, but at times I run, and I am challenging to hide. I am always with you. What am I?  Answer: Your nose.

Herd of Scandinavian Horses, Iceland

Footnotes And Sources

^{1. The Wall Street Journal, April 14, 2023}

^{2. The Wall Street Journal, April 14, 2023}

^{3. The Wall Street Journal, April 14, 2023}

^{4. The Wall Street Journal, April 12, 2023}

^{5. The Wall Street Journal, April 13, 2023}

^{6. IRS.gov, August 8, 2022}

^{7. Medical News Today, March 21, 2023}

^{Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.}

^{The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.}

^{The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.}

^{The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.}

^{U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.}

^{International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.}

^{Please consult your financial professional for additional information.}

^{This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.}

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