Stocks fell last week as investors sorted through conflicting inflation reports and assessed geopolitical tensions.
Inflation Spooks Markets
On Wednesday, the March Consumer Price Index (CPI) report rattled markets, revealing that inflation accelerated slightly more than expected. Bond yields rose, and stocks retreated in response, as investors feared the news could influence the Fed’s rate decision. The 10-year Treasury yield had its highest intraday jump in three years.1,2,3
Markets rallied Thursday as investors were encouraged by the Producer Price Index (PPI) report, which measures inflation at the producer level. Unlike CPI, PPI rose less than expected, which sparked a tech-focused rally. Markets opened lower on Friday as investors wrestled with the conflicting inflation reports.
Fears of an escalating Middle East conflict also weighed on stocks during the week. Concerns about a potential weekend event led some investors to end the week in a risk-off position.4
Source: YCharts.com, April 13, 2024. Weekly performance is measured from Monday, April 8, to Friday, April 12.
ROC 5 = the rate of change in the index for the previous 5 trading days.
TR = total return for the index, which includes any dividends as well as any other cash distributions during the period.
Treasury note yield is expressed in basis points.
Inflated Expectations
Minutes from the March Fed meeting, published Wednesday, showed officials’ concern that inflation wasn’t slowing down quickly enough toward the Fed’s 2% target. But despite sticky inflation, they reiterated that rate cuts were still on the table for this year.
The start of Q1 earnings season reinforced inflation concerns as several leading money center banks—despite many beating expectations—forecasted lower growth for the remainder of 2024 due partly to inflation and higher-than-expected rates.
On Friday, the University of Michigan’s survey showed consumer sentiment fell last month. Some concluded that the survey confirmed what consumers have been saying for months—that inflation is still in their everyday lives.5,6
This Week: Key Economic Data
Monday: Retail Sales. Business Inventories. Housing Market Index. Empire State Manufacturing Index.
Tuesday: Housing Starts and Permits. Industrial Production.
Wednesday: EIA Petroleum Status Report. Treasury International Capital. Beige Book. 20-Year Treasury Bond Auction.
Thursday: Jobless Claims. Existing Home Sales. EIA Natural Gas Report. Philadelphia Fed Manufacturing Index.
Source: Investors Business Daily – Econoday economic calendar; April 11, 2024
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.
“The fool doth think he is wise, but the wise man knows himself to be a fool.”
– William Shakespeare
Hydrate the Healthy Way
Are you trying to kick a soda habit but sick of water? There are many fun and healthy means to make your water taste better and encourage you to drink more. Here are some easy ways to spice up your normal water:
Add fresh fruit slices, such as lemon, lime, or orange. Not only will these fruits make your water taste better, but you may also enjoy some of the benefits of these citrus powerhouses.
Add some sliced cucumber to your water to make it feel pampered. Who needs the spa when you have a nice glass of cucumber water sitting at your desk?
Try some sugar-free, low-calorie water sweeteners. They are an appealing option for those who have a sweet tooth and crave soda but are trying to drink more water. Mix it up with sparkling water or seltzer if you miss the fizz of soda. Most sparkling waters are calorie-free or low in calories while keeping you hydrated.
It would help to drink at least half of your body weight in ounces of water daily. What are some of your favorite methods to make water more exciting?
Tip adapted from Baton Rouge Clinic8
1. The Wall Street Journal, April 12, 2024
2. CNBC.com, April 10, 2024
3. The Wall Street Journal, April 11, 2024
4. CNBC.com, April 12, 2024
5. MarketWatch.com, April 11, 2024
6. CNBC.com, April 10, 2024
7. IRS.gov, February 13, 2023
8. Baton Rouge Clinic, January 23, 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.
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