Market Recap: Inflation Steady, GDP Growth Slows, Earnings Season Starts Strong

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Earnings Season

Market Recap: Inflation Steady, GDP Growth Slows, Earnings Season Starts Strong

SPY
S&P 500

Last Week: 2.70%
YTD: 7.27%
1 Year: 23.98%

DIA

Dow Jones Industrial Average

Last Week: -0.02%
YTD: 1.96%
1 Year: 14.28%

ONEQ
NASDAQ

Last Week: 4.20%
YTD: 6.18%
1 Year: 31.85% 

Russell 2000

Last Week: 1.57%
YTD: -0.92%
1 Year: 14.78% 

Large Growth

YTD: 8.41%
1 Year: 33.98% 

Large Value

YTD: 5.26%
1 Year: 14.50%

Key Inflation Data

A key inflation indicator used by the Fed, the personal consumption expenditures price index excluding food and energy, rose 2.8% from a year ago during March. This was the same as the number from February, showing inflation did not go down. This was above the analysts’ expectations of 2.7%. The stock market reacted very little to this data, surprisingly. Personal spending rose 0.8% for the month, a small amount higher than the expected increase of 0.7%. Consumers continue to spend and keep pace with inflation. 

GDP Growth Slows

U.S. economic growth, as measured by Gross Domestic Product, was weaker than expected at the start of the year. The annual increase slowed to 1.6%, adjusted for inflation. The price of goods rose at a faster pace, cutting into GDP growth. Economists had been expecting an increase of 2.4% following the 3.4% gain in the fourth quarter of 2023. The stock market traded down following this news that the economy may be cooling off. This is, however, one indicator the Fed will use when deciding to start cutting rates. Wall Street is now expecting one to two cuts this year beginning in September.

Earnings Season Underway

Last week kicked off a slew of corporate earnings. Strong earnings have given investors a sigh of relief despite inflation pressures and slowing GDP. Of the companies releasing earnings last week, over 75% of them have beaten the analysts’ expectations, according to FactSet data. The strong earnings helped lead the S&P and Nasdaq to their best week this year and snap a 3-week losing streak. Later this week, we will see the Fed’s monetary policy meeting notes and non-farm payroll numbers. 

  • Alex Wolfe

    Alex is a Certified Financial Planner™. He brings nearly a decade of experience working with individuals, families, and business owners. Prior to working for Base Wealth Management, Alex worked for Fidelity Investments and an independent wealth management firm in Venice, FL. Through many years of practice, he specializes in helping clients navigate their financial goals through comprehensive financial planning. He received his bachelor’s degree in economics from Texas A&M University.

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2022 Tax Document Information

As a Base Wealth Management client, you should receive your paper tax documents via mail in the coming weeks. Or, if you previously had an online account with Pershing’s NetX360, you should be able to access your 2022 tax documents through that portal. 

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