Strength of the Market
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The Strength of the Market is: Weak

After a highly anticipated inflation report showed a faster-than-expected rise in prices, stocks dropped sharply to end the week. Last week, the Dow Jones fell 4.58% (now down 10 out of the last 11 weeks), the S&P 500 dropped 5.05% and the Nasdaq Composite lost 5.60% (both down 9 out of the last 10 weeks). The latest inflation numbers came in at its highest level since 1981. With prices surging, investors need to begin preparing for a more aggressive Federal Reserve and the real possibility of a recession.

Economic reports from last week came back mixed: •Consumer Credit - better than expectation •Consumer Sentiment - worse than expectation •Jobless Claims - worse than expectation This week, investors will look for guidance from economic reports like Small Business Optimism, Retail Sales, Manufacturing, Housing and Jobless Claims.