The Strength of the Market is: Strong
Stubbornly high inflation and a rebound in interest rates weighed on investors last week - the Dow was down 0.13% (its third negative week in a row), the S&P 500 shed 0.28% (its second negative week in a row) and the Nasdaq was up 0.59%. Investors continue to worry about how the economy and the stock market will hold up as the Federal Reserve keeps hiking rates, especially since there is still a long way to go before the target of 2% inflation is reached (inflation is currently at 6.4%). Now, in the least, a couple more interest rate increases should be expected.
Economic reports from last week came back mixed: •Small Business Optimism - in-line with expectation •Retail Sales - higher than expectation •Manufacturing (New York) - higher than expectation •Manufacturing (Philadelphia) - lower than expectation •New Residential Construction - lower than expectation •Homebuilder Sentiment - higher than expectation •Jobless Claims - lower than expectation In a holiday-shortened week, investors will look for guidance from economic reports like Manufacturing, Housing, Personal Income, Consumer Sentiment and Jobless Claims.