The Strength of the Market is: Strong

The Strength of the Market is: Strong

Last week, investors monitored the latest developments out of the Middle East. Tensions around the Israel-Iran conflict remained high, as Israeli Prime Minister Benjamin Netanyahu is reportedly ordering Jerusalem’s military to strike “strategic targets” and “government targets” in Iran. President Trump is weighing direct U.S. involvement with a strike on Tehran. In addition, investors are monitoring the path of future interest rate cuts by Federal Reserve. Fed Chair Jerome Powell said Wednesday the central bank was in no hurry to cut interest rates and will remain data dependent, especially as it remains unclear how President Donald Trump’s tariffs will impact the economy. Even with so much uncertainty around the world, the S&P 500 is still only around 3% below its recent 52-week high. Last week, the S&P 500 was about 0.2% lower, the Dow Jones gained 0.02% and the Nasdaq advanced 0.2%. Over the weekend, in a surprise move, the United States entered Israel’s war against Iran by striking three nuclear sites - the expectations are now for a rising oil price and higher risk for a larger conflict in the Middle East.

Economic reports from last week came back mostly negative:

•Manufacturing (New York) - lower than expectation

•Manufacturing (Philadelphia) - lower than expectation

•Retail Sales - lower than expectation

•Homebuilder Sentiment - lower than expectation

•New Residential Construction - lower than expectation

•Jobless Claims - higher than expectation

This week, investors will look for guidance from economic reports like Housing, Consumer Confidence & Sentiment, Manufacturing, Gross Domestic Product, Personal Income and Jobless Claims.