wealth management

U.S. equities attempted to rally at the end of last week as Russian President Putin claimed some progress in talks with Ukraine. Indexes finished near the lows, extending the 2022 losing streak. Months of anticipation will reveal in the Fed’s interest rate decision this week, the beginning of rate hikes. Surging energy prices and inflation is largely attributable to supply-side challenges, yet the Fed believes the current policy is too loose. The S&P 500 and Nasdaq Composite indexes fell more than 3% last week.

Last Week – Energy Prices

The stock market losing streak continued. The DJIA was down 1.99%, while the S&P 500 was off 2.88%, and the Nasdaq Composite declined 3.53% for the week. On Tuesday, the NFIB small business optimism index for February slipped to 95.7. Lower than January’s reading of 97.1. Small business owners are feeling the impacts of wage inflation and rising fuel costs. On Wednesday, weekly mortgage applications rose 8.5% overall. Both originations and refinancing’s were up in high single digits among rising rates.

Weekly initial unemployment claims moved higher on Thursday, to 227,000 from the pandemic low of 216,000 the prior week. The big inflation data last week was the February consumer price index (CPI) report. The all-items CPI rose 7.9% annually, the highest in 40 years. Energy prices soared as the war in Europe continues. The core index, which excludes food and fuel, rose 0.5% monthly and 6.4% annually. The Russian invasion dismissed belief of cooling inflation. The War in Europe has spiked petroleum prices around the world. Wrapping the data week on Friday, University of Michigan consumer sentiment for March slipped below 60 to 59.7. Consumer sentiment reached 10-year lows. On top of inflation concerns, the war in Europe is adding to general geopolitical anxiety.

Week Ahead

The markets may need the Luck of the Irish on Thursday to snap the losing streak. The February Producer Price Index estimates to rise 1.0% month-over-month and 10% annually. The core PPI estimate to rise 0.6% monthly and 8.3% annually. Wednesday retail sales report, expected to rise 0.5% for February after the surprising 3.8% gain for January. Inflation is causing consumers to spend more for less and potentially cutting into savings. Most experts agree the Fed’s hiking path is likely to be slower than previously expected considering the war in Europe. The current reports believe a 0.25% rise in interest rates on Wednesday.

The NAHB housing market index estimate for March is the low 80s, in line with February’s 82. On Thursday, February housing starts are forecast at a 1.700 million SAAR (seasonally adjusted). This would be an improvement from the 1.638 million SAAR for January. Capacity utilization is forecast to edge higher to 77.8% from 77.6% for January. Factories continue to run all-out to address the supply-chain crisis. On Friday, existing home sales report estimated to come in at a 6.17 million SAAR for February. This would be a decline from a 6.50 million SAAR for January.

Year-to-date index performance; Dow down 9.3%, S&P down 11.8%, and Nasdaq down 17.9% through the close on Friday.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

Financial Advisor Erie CO focus on investment and wealth management, retirement planning; Boulder, Louisville, Niwot, Lafayette, Windsor, Berthoud, CO

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

The Russian invasion of Ukraine extended the stock market’s losing streak last week. The invasion intensified, sending global commodity prices soaring and sustaining volatility. Uncertainty is mounting. With the spike in commodity prices, global central banks’ mission to curtail inflation becomes more difficult. For the week ending Friday, Nasdaq fell 2.75%, S&P 500 down 1.24%, and the Dow Jones down 1.23%.

The last two weeks, the world changed. As we watch the horrifying events unfold in Ukraine and the political and economic fallout, it’s hard not to worry. One thing that can help when you feel worried is to identify and take small steps to create positive results. For example:

• – review your portfolio, we can look for ways to diversify your investments if needed to help reduce risk and renew your confidence that we continue on the path to help achieve your long-term goals
• – don’t forget about other money deadlines, like your tax preparation for filing this year
• – take time to recognize signs of burnout and focus on your personal wellbeing

Last Week – Invasion Continues

With geopolitical tensions rising, investors ignored highly positive economic data in the U.S. last week. The S&P 500 hit an all-time closing high on the first day of trading this year. Since then, the index reversed and is down 8.94% year-to-date as of last Friday. Crude oil closed at $115.68 per barrel on Friday, rising 26.30% for the week. Crude hasn’t seen per barrel prices of $100 or more since 2014.

The jobs report released last week showed the U.S. added 678,000 jobs in February, which was well above expectations. The unemployment rate fell from 4.0% in January to 3.8% in February. Slightly above the 3.5% rate from February 2020. Both readings of the February ISM Manufacturing and Non-Manufacturing Indexes continued to indicate expansion. Supply chain issues and labor shortages remain a headwind for both. However, this comes amid strong demand as the economy continues to reopen.

On Wednesday, Federal Reserve Chairman Jerome Powell confirmed rate hikes were coming, while acknowledging uncertainty related to Ukraine. He also said he would support a quarter-percentage-point rate hike at the Fed’s upcoming meeting on March 15-16. This is the Fed’s first rate increase since 2018. Powell also said the Fed will tread carefully given geopolitical turmoil and its uncertain impact on the U.S. economy. The comments all but end speculation that the Fed would raise interest rates by 0.50% at the March meeting. Larger rate hike are not ruled out for future meetings if inflation doesn’t come down from current four-decade highs.

Week Ahead

Uncertainty is only mounting. The spike in commodity prices is making the global central banks’ mission to curtail inflation increasingly more difficult. Inflation data will dominate investor headlines this week. On Tuesday, the NFIB small business optimism index for February is forecast to hold in the high 90’s range. Small business sentiment, already hurt by wage inflation, could worsen as the Ukrainian invasion further pushes up gas prices. On Wednesday, weekly mortgage applications are expected to extend recent declines. Largely thanks to the February surge past 2.0% in the 10-year Treasury yield.

In addition to weekly initial unemployment claims, Thursday brings the consumer price index report for February. The all-items CPI is forecast to rise 0.7% on a month-over-month basis and 7.9% year-over-year. Wrapping the data week on Friday is University of Michigan consumer sentiment. The reading is expected to drop to 61.7 for March from 62.8 for February. The war in Europe adds to consumer worries. Year-to-date, the Dow is down 7.5%; the S&P 500 is off 9.2%. The Nasdaq is now down 14.9% year to date.

Click here if you would like to learn more about your options. And if we can assist you with your wealth management, investment, and retirement planning.

Erie CO Financial Advisor; investments, wealth management, retirement income planning; Boulder, Broomfield, Louisville, Niwot, Windsor, Berthoud CO

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.

Is a sloppy spring in store this year? Tax season is underway and it may be a little more complicated this year due to a backlog at the IRS. As we continue to recover from the pandemic’s effects on the economy and our individual finances, you may be facing some complicated situations or a backlog yourself. 

Whatever questions you have, know you’re not going it alone. A problem shared is a problem halved. Together, we can tackle each issue you’re up against – whether it’s concerns about your tax return, an aging parent, or even strategies around how best to save for more of life’s unexpected changes. Even the most complicated situations can be simplified into actionable next steps. And I can be a great resource for you. Reach out and let’s talk about it.

Last Week

The stock market fell last week as the attention changed from inflation to the potential Russian invasion of Ukraine. The geopolitical uncertainty renewed investor interest in safe assets going into President’s Day weekend. The invasion does not necessarily impact corporate profits in the U.S. Therefore, a stock market drop due to the invasion could be viewed as a buying opportunity. For the week, the DJIA was down 1.9%, the S&P 500 was down 1.6%, and the Nasdaq was down 1.8%.

Trading remained volatile and inflation pressure remains. Amid supply-chain crisis and strong demand, January all-items producer price index was up 1.0% m-o-m and up 9.7% y-o-y. Consumer spending remains strong too. On Wednesday, January retail sales surprised with a 3.8% increase from December’s decline. And better than the 2.0% consensus estimate.

Also on Wednesday, U.S. Industrial production rose 1.4% following December’s decline. On Thursday, January housing starts slipped. Permits went the other way, rising to an above-consensus figure, suggesting that the spring building season may be strong. On Friday, existing home sales for January were also strong. Existing home sales were up 6.7% month-over-month, though down 2.3% year-over-year as available-homes inventory remains near record lows. Mortgage rates continued to rise, and new home construction fell 4.1% in January. Resulting from tight labor and materials but permits to build lifted to the highest levels since 2006.

Week Ahead – Sloppy Spring?

The current holiday-shortened data week kicks off today with the Case-Shiller home price index. Economists look for a 1.1% monthly gain. The Conference Board’s Consumer Confidence index expects a decline for February as inflation adds to consumers’ concerns. On Wednesday, the weekly mortgage application report expects to continue the downward trend. Rising interest rates are forcing more would-be homebuyers out of the market. Thursday brings the second (preliminary) estimate of 4Q21 GDP. The report expects the forecast to edge up to 7.0%. Thursday also brings January new home sales, which are expected at an 801,000. On Friday, U.S. durable goods orders and core capital goods orders are both forecast up 0.5% month-over-month. The industrial sector continues pushing out all the goods it can to reach high demand amid the supply chain crisis.

This week marked two years since the pre-COVID-19 market high and the stay-at-home trade may have finally run its course. Many pandemic favorites indicated slowing growth including Shopify, Etsy, and Roblox. Fun investment nugget, Hilton Worldwide is now outperforming Zoom Video Communications since the pre-pandemic market peak in February 2020. Year-to-date index performance; Dow down 6.2%, S&P down 8.8%, and Nasdaq down 13.4% through the close on Friday.

Click here if you would like to learn more about your options and if we can assist you with your wealth management, investment, and retirement planning.

Erie CO Financial Advisor; investments, wealth management, retirement income planning; Boulder, Broomfield, Louisville, Niwot, Windsor, Berthoud CO

This website is for informational purposes only and is not intended to be specific advice or recommendations. For specific advice or recommendations you would need to meet directly with one of our advisers.