ClientFirst Financial Strategies
Financial Planning and Portfolio Management
So far, so good! Or is it too good to be true? Right now, the S&P 500 is trading at a lofty 17.9x 2023’s expected earnings even though quite a few companies are projecting lower future earnings.
US stock market indices had mixed results during the shortened trading week. The economic theme du jour now features the debt ceiling, which the US hit this past Thursday.
After the negative results from 2022, should we just stop the clock right now for 2023? All three major US stock market indices produced positive returns for the second week in a row. Gosh, that feels good…for the moment.
One week into the new year, we have year-to-date gains to celebrate! More than likely, the US stock market will continue to experience high volatility this week with additional economic data and the beginning of 4Q2022 earnings releases.
For sure, the Grinch came out this past week with all three major US stock market indices sustaining losses. Some analysts place the blame on the Fed continuing to raise interest rates to fight inflation while others point the finger at institutional investors licking their wounds for the year by booking losses before year end.
Tis’ the season to be jolly but also the time of the year when analysts’ forecasts become most prevalent. Always remember, you can never be wrong if you don’t have an opinion! We are sharing two as food for thought.
This week, the Federal Reserve essentially signaled that interest rates will probably continue to rise but at a slower pace than they have throughout this year — meaning 0.50% versus 0.75% increases.
As we head into the last month of 2022, two things are top of mind: the Fed (interest rates) and recession. Although tangentially related, the ultimate results will dictate the coming year in the economy and, thus, the stock market. Both will survive, but which roller coaster will we ride?
Is it time to get giddy about the US stock market? For the week, all three US stock market indices gave us hope as we head to the finish line for the year.
Chairman Powell’s post-meeting comments sent the US stock market in a tizzy indicating there may be more hikes to come! That being the case, market volatility probably will remain elevated alongside this week’s midterm election.