Last week, upbeat corporate earnings and a decrease in jobless claims helped the S&P 500 gain 1.35%, contributing to a two-week cumulative gain of 7.23%. Impressively, this two-week gain represents 43% of the S&P 500’s total annual gain of 16.60%, underscoring the challenge of market timing. Instead, successful long-term investing requires a planned and disciplined approach.
This week, attention returns to inflation. The Consumer Price Index (CPI) for October reports tomorrow, with an expected month-over-month increase in Core CPI of 0.30%. On Wednesday, the Producer Price Index (PPI) is forecasted to rise by 0.10% for the month. Lower-than-anticipated inflation figures would be favorable for both stocks and bonds. Also, on Wednesday are retail sales figures, with the market anticipating a month-over-month decline of -0.30%. Considering that private consumption constituted 67.7% of the GDP in September 2023, a slowdown in spending would be a headwind for U.S. economic growth and cyclical stocks.
Have a great week, and thanks for reading!
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