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2/12/24 Weekly Market Commentary

2/12/24 Weekly Market Commentary

February 12, 2024

What happened last week…         

The S&P 500 closed above the 5,000 level for the first time ever. The three major indices have notched their fifth straight positive week and have gone green in 14 of the past 15 weeks. Year-to-date performances are as follows: DJIA (2.61%), S&P 500 (5.38%), NASDAQ (6.52%).

Minneapolis Fed President Neel Kashkari, a nonvoting member this year on the Federal Open Market Committee, said he believes two or three rate cuts would be appropriate given current economic data. Kashkari noted inflation data “has been resoundingly positive” and added “maybe monetary policy is not putting as much downward pressure on demand as we would otherwise think.” Kashkari said this “gives us more time to access that data before we start reducing interest rates.” With recent comments from Fed officials in mind the markets have shifted their expectations on the first rate cut. According to the CME FedWatch Tool, as of February 9, there is an 82.5% probability rates will remain at 5.25% to 5.50% after the March 20 meeting while there is a 58.5% probability for the first rate cut to happen after the May 1 meeting.

The non-manufacturing PMI for January beat expectations (52.0) as it increased to 53.4 from the downwardly 50.5 (from 50.6), making it the highest reading in four months and the 13th straight month of an expansionary reading.

According to FactSet, as of February 9, 67% of S&P 500 companies have reported earnings with 75% having a positive EPS surprise and 65% having a positive revenue surprise. The blended earnings for the S&P 500 is 2.9%, which would be the second-straight quarter of growth. The blended revenue for the index is 3.9%, which would be the 13th straight quarter of growth. 

Happening this week…

On Tuesday, the inflation rate year-over-year for January is expected to decrease to 3.0% from 3.4%, which was the highest reading since last September (3.7%) but still far below the peak rate of 9.1% that was reported in June 2022.

Thanks for Reading!

- The Rockline Team

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

The Dow Jones Industrial Average is comprised of 30 stocks that are major factors in their industries and widely held by individuals and institutional investors. The Dow Jones Industrial Average is comprised of 30 stocks that are major factors in their industries and widely held by individuals and institutional investors.

The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index.

The S&P 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. 

All investing involves risk including loss of principal.