Last Week: -2.39%
YTD: 11.37%
1 Year: 17.10%
Dow Jones Industrial Average
Last Week: -1.58%
YTD: 1.53%
1 Year: 11.45%
Last Week: -2.98%
YTD: 25.66%
1 Year: 24.11%
Last Week: -2.25%
YTD: -3.47%
1 Year: .03%
YTD: 27.25%
1 Year: 28.60%
*As of 9/30/2023
YTD: 3.53%
1 Year: 19.68%
*As of 9/30/2023
Retail Sales Rise
Retail sales rose by .7% on the month. This was well above the .3% Dow Jones estimate. Retail sales is a measure closely watched by the Federal Reserve when it comes to interest rate hikes. We continue to see varying information that is contradictory when it comes to predicting a recession and future rate increases. Consumer spending kept up with inflation this past month. In 2023, we have seen household debt rise, but coming off healthy household balance sheets, this is not too surprising.
Homebuilder Sentiment
62% of builders reported offering sales incentives in October, up from 59% in September. This is the third straight monthly decline in builder confidence. The average 30-year fixed mortgage rates remain over 7%.
10-Year Treasury
Fed Chairman Jerome Powell stated “inflation is still too high,” sending the 10-year Treasury yield over 5% for the first time since July 2007. The bond market typically trades in anticipation of key data and information regarding interest rate hikes. Given Chairman Powell’s comments, it is signaling future rate hikes are likely coming. Increasing rates will undoubtedly mean mortgage rates, car loans, and student loans will see their interest rates climb.
Earnings Season
Investors will be looking for strong earnings this week from Apple (AAPL), Microsoft (MSFT), Nvidia (NVDA), Meta Platforms (META), Amazon (AMZN) and other technology and growth stocks. With bond yields being at 15-year highs, investors will be looking for reasons to continue adding to equities versus fleeing to fixed income and cash. Growth and tech companies are more vulnerable to higher yields, as their future cash flows are seen as less valuable when investors are able to get respectable returns from risk-free government bonds.
