What happened last week...
The Federal Reserve released meeting minutes from its January gathering where interest rates were kept at 5.25% to 5.50%. According to the minutes, “Most participants noted the risks of moving too quickly to ease the stance of policy and emphasized the importance of carefully assessing incoming data in judging whether inflation is moving down sustainably to 2 percent.” While participants viewed the current policy rate as “likely at its peak” they “did not expect it would be appropriate to reduce the target range for the federal funds rate until they had gained greater confidence that inflation was moving sustainably toward 2 percent.” The next Federal Open Market Committee meeting takes place March 19-20.
On February 26, Amazon (AMZN) will replace Walgreens Boots Alliance (WBA) in the Dow Jones Industrial Average (DJIA). S&P Dow Jones Indices, which manages the 30-stock average, said, “Reflecting the evolving nature of the American economy, this change will increase consumer retail exposure as well as other business areas in the DJIA.” The “change was prompted” by Walmart’s (WMT) upcoming 3-for-1 stock split, which also takes place the same day. Walmart will remain in the DJIA.
Walmart (WMT) will purchase TV maker Vizio (VZIO) for $2.3 billion, which the company will use to help grow its advertising revenue. Walmart’s Chief Revenue Officer Seth Dallaire said, “We believe VIZIO’s customer-centric operating system provides great viewing experiences at attractive price points. We also believe it enables a profitable advertising business that is rapidly scaling.”
Existing home sales for January beat expectations (3.97 million) as it increased to 4.00 million from the upwardly revised 3.88 million (from 3.78 million), making it the highest reading in five months.
Happening this week…
On Monday, new home sales for January are expected to increase to 680,000 from 664,000. The peak reading over the previous 12 months is 728,000 from last July.
On Wednesday, the GDP growth rate (second estimate) for Q4 2023 is expected to match the prior estimated reading of 3.3%, which declined from the Q3 2023 reading of 4.9%—the highest since Q4 2021.
On Friday, the manufacturing PMI for February is expected to increase to 49.5 from 49.1, which was the highest reading since October 2022 but marked the 15th straight contractionary reading (below 50).
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