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  • Scott Poore, AIF, AWMA, APMA

Good Start To The New Year

Equities were higher overall for the first week of 2023. The first week of trading in 2023 carried the all too familiar theme of “up-one-day-down-the-next” from 2022 into the new year.

During the week, the release of the Fed’s minutes from its December meeting showed that members were resolved in maintaining their hawkish stance. The committee members especially noted concern over wage growth and how that could keep inflation high in their view. This drove continued fears that the Fed has a long runway to continue hiking rates. However, on Friday, we got a strong final jobs report for 2022 that sparked a relief rally. In that report, wage growth was shown to have declined in December. In fact, wage growth was the lowest since August of 2021.


This data caused investors to once again hope that rate hiking is closer to an end. After being down much of the week, equities rallied more than 2% on Friday.

We would caution on too much excitement just yet. The rest of the economic data from last week was mixed. Jobless Claims were the lowest since early October of last year. The JOLTs data showed job openings are still high and employers are looking to hire, as opposed to laying off workers. And yet, manufacturing data is still weak, factory orders were down, and vehicle sales were lower in 2022. The CPI data will be key this week, as a potentially 6th consecutive month of declines would bode well for equities.


 

Disclosures


The information contained herein is for informational purposes only and is developed from sources believed to be providing accurate information. The opinions expressed are those of the author, are for general information, and should not be considered a solicitation for the purchase or sale of any security. The decision to review or consider the purchase or sell of any security should not be undertaken without consideration of your personal financial information, investment objectives and risk tolerance with your financial professional.


Forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.


Any market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.


Past Performance does not guarantee future results.



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