Markets “In A Nutshell” for April 1, 2024

Markets “In a Nutshell” for April 1, 2024

Investment Week at a Glance

Stocks finished higher for the week. The Dow Jones Industrial Average rose 0.80%, the S&P 500 was up 0.40%, and the NASDAQ fell 0.30%. Foreign stocks (MSCI EAFE) were also down, falling 0.10%. Bond prices were flat for the week, with the 10-year U.S. Treasury ending the week at 4.20%.  (Data source: Wall Street Journal)

Q1 Recap

Markets wrapped up the first quarter last week and continued to move higher as the Dow Jones ended up over 5% for the quarter. Foreign markets were also up over 5% for the quarter while the S&P 500 led the way among all indices at over 10%. Bonds continued to underperform as they were down 0.6% for the first quarter. Oil has quietly been on the rise again as it rose over 15% in the first quarter. As we look ahead to Q2, the main focus once again will be on the Fed and its decision on what to do with rates. There will be two Fed meetings throughout the next quarter where the Fed could begin to cut rates. There is a small chance they cut rates in May, but investors are expecting a cut in June which could help boost the market.

Opportunities Ahead

It is rare to see what we have seen in the past 5 months where the market has just moved higher with no bumps in the road. A possible pullback and correction should be expected at some point this year but with resilient economic growth and the Fed beginning a rate-cut cycle at some point, the overall move higher is likely to continue in the long run. Some areas that could perform well are mid-cap stocks as they historically perform the best 12-18 months following the last rate hike. They have underperformed since July of last year when the Fed had its last rate cut but could begin to outperform as the Fed looks to cut rates. Another boost to the market overall will be if inflation data continues to move lower. Although there has been a lot of progress, there is still a little work left to get closer to the 2% target. This may take some time but it is important to not see inflation tick back up these next few months or rate cuts may be off the table.

Quiz:

What is the current price of oil per barrel?  (Scroll Down for Answer)

 

1.     $83
2.     $87
3.     $91
4.     $95

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer below.

 

 

Have a Great Week!

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer:

1.    $83.  The price of oil has moved higher throughout the year and could cause inflation to be higher as higher oil prices tend to spread to other parts of the economy.