The Strength of the Market is: Strong

Last week, Wall Street completed its first weekly gain of the new year. For the week, the Dow Jones was up 3.7% and the S&P 500 gained 2.9%, their biggest weekly advance since November. The Nasdaq gained 2.5% for the week. Those gains come after investors received back-to-back reports showing inflationary pressures softening somewhat. Strong earnings from major banks (Goldman Sachs, Citigroup and JPMorgan Chase) boosted stocks. Investors are also looking ahead to this week, as Donald Trump was inaugurated yesterday as president for the second time.

Economic reports from last week came back mixed:

•Small Business Optimism - higher than expectation

•Inflation (Producer) - lower than expectation

•Inflation (Consumer) - higher than expectation

•Manufacturing (New York) - lower than expectation

•Manufacturing (Philadelphia) - higher than expectation

•Retail Sales - lower than expectation

•Homebuilder Sentiment - higher than expectation

•New Residential Construction - higher than expectation

•Jobless Claims - higher than expectation

In a holiday-shortened week, investors will look for guidance from economic reports like Manufacturing, Consumer Sentiment, Housing and Jobless Claims.