(910) 319-7834
It has been a bumpy week for the market. Earnings season is in full stride with several stocks reporting this week. Microsoft, Apple, Meta, and Alphabet traded lower this week on their earnings announcements. On the contrary, Intel, Amazon, Exxon, and Chevron share prices rose after reporting.
As election day draws nearer, market volatility is increasing. The VIX, also known as the “Fear Index” has risen to levels last seen during the August 2024 market upheaval. The Artificial Intelligence (AI) euphoria has waned as investors grow weary of their Return on Investment (ROI).
Major Index Performances (as of Thursday Close):
- S&P 500: The benchmark index dropped about (1.76%)
- Dow Jones Industrial Average: The Dow lost (.83%)
- Nasdaq Composite: The index sank (2.28%)
Economic data reported this week:
The personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure, increased by 2.1% last month on an annual basis, close to the central bank’s goal of 2%. That could cement more rate cuts in 2024.
In October, US hiring advanced at the slowest pace since 2020 while the unemployment rate held steady (4.1%) in a month distorted by severe hurricanes and a major strike. Non-farm payrolls increased 12,000 last month, following a downward revision to the prior two months. Hourly earnings remained firm according to Bureau of Labor Statistics’ (BLS) figures released Friday.
The BLS wrote Helene and Milton likely affected payrolls in some industries, but indicated it is not possible to quantify the net effect on the monthly change in national employment, hours, or earnings estimates. They noted the collection rate for the survey of businesses (informs the statistics) was “well below average.” BLS also said there was no discernible effect on the national unemployment rate.
Portfolio changes:
We added 10-year treasuries to our strategies this week. The 10-year rate has risen .50% since the Federal Reserve cut rates in September. The money market rate has fallen to 4.51%, and the 10-year note was an attractive alternative, allowing us to lock-in a solid rate.
Election day should be interesting. My hope is we have a clear-cut winner by Wednesday morning. Regardless of the outcome, I believe the market could have an immediate reaction, but it will be short-lived, and trading will revert to the norm. Do not forget to vote!
Have a wonderful weekend,
Your Portfolio Management Team
