Category: Weekly Market Commentary
Market Commentary
Market Commentary: Inflation Finally Falls Flat, Stocks Respond Positively
Inflation slowed significantly in July. Lower energy prices, including a 7.7% decline in gasoline prices, helped the Consumer Price Index stay flat. Food and shelter costs helped offset the decline in energy prices. The core inflation rate fell to 0.3%, suggesting inflationary pressures are …
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Market Commentary: U.S. Adds 528,000 New Jobs and Unemployment Reaches Pre-Pandemic Low
The U.S. job market didn’t get the message it was supposed to slow down. The establishment survey estimated 528,000 new jobs were created last month. Every employment sector experienced growth, although services and government hiring accounted for 87% of new jobs.
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Market Commentary: As Anticipated, Fed Announces Another 0.75% Rate Hike
Last week was a big one for monetary policy and economic data. The Federal Reserve raised interest rates 0.75%, with unanimous agreement that higher rates were required to bring inflation under control. In his press conference, Fed Chair Jerome Powell announced the Fed was becoming more dat …
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Market Commentary: European Central Bank Joins Fight Against Inflation, Raises Rates 0.5%
Central banks are playing the leading role in today’s markets. Last week, the European Central Bank raised interest rates 0.5%, pulling the deposit facility rate to 0%. It is the first interest rate increase in 11 years and the first time the rate hasn’t been negative in eight years. Japan’ …
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Market Commentary: U.S. Consumers Still Strong Amid Inflation; Fed Remains Hawkish
The Consumer Price Index (CPI) leapt 1.3% in June, following a 1.0% increase in May. The measure of inflation has risen 9.1% in the last year and reached its highest level since 1981 (Figure 1). Energy prices have been the top contributor in the last 12 months, responsible for 3.0% of the 9 …
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Market Commentary: Robust Labor Market Growth Continues with Fed Poised for Another Rate Hike
Positive jobs data supported the market last week. The U.S. establishment survey indicated 372,000 new jobs were created in June. The rally was broad-based as every sector added jobs last month except for the governmental sector. Health care, professional and business services, and leisure …
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Market Commentary: Moderating Inflation, Ebbing Political Uncertainty Among Reasons for Hope in the Face of a Tough Market
The Personal Consumption Expenditure (PCE) Price Index increased 0.6% in May, after rising only 0.2% in April. PCE inflation is an alternative inflation measure to the Consumer Price Index (CPI), which is released earlier. The two measures both show inflation to be very high, but the CPI in …
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Market Commentary: S&P 500 Rallies 6.5%, Lifting Market Above Bear Level
The S&P 500 spent only a short time below the 20%-decline threshold, before jumping back above it last week. U.S. large-cap stocks rallied 6.5% based on optimism that inflationary pressures are starting to respond to higher interest rates.
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Market Commentary: Fed Raises Rates by 0.75%, Market Moves Into Bear Territory
The S&P 500 dropped 5.7% last week and is now 22.3% off its peak. This decline pushed the index of large-cap U.S. stocks into a bear market, which is defined as a 20% or greater drop from its peak. Volatility remained elevated, and the S&P 500 has now moved by 1% or more 60 times …
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Special Market Commentary: S&P 500 Slips Into a Bear Market. Now What?
Fueled by inflation readings that have remained stubbornly elevated, the stock market, measured as the S&P 500 Index, entered bear market territory at market close on June 13, 2022. A bear market represents a decline in equity values by more than 20%.
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