The overhang of Fed Chair Powell’s Jackson Hole speech the previous week carried over into last week as investors recalibrated stock valuations amid a seemingly more assertive monetary policy stance.
The Dow Jones Industrial Average fell 2.99%, while the Standard & Poor’s 500 stumbled 3.29%. The Nasdaq Composite index lost 4.21%. The MSCI EAFE index, which tracks developed overseas stock markets, slid 4.90%. 1,2,3
Stocks Extend Losses
Investors remained unnerved by the aggressive tone of Jerome Powell’s speech and subsequent comments from Fed officials suggesting a higher rate hike than the market expected at the Fed two-day meeting ending September 21. The probability of a 75 basis point hike in September rose to nearly 65%, up from just 28% a month ago.4
Stocks moved steadily lower before finding some footing on Thursday. Friday’s employment report appeared to strike a “goldilocks” note (i.e., labor gains not so strong that it might trigger greater Fed hawkishness but robust enough to allay imminent recession fears). After early gains, stocks turned lower ahead of the holiday weekend.
Employers added 315,000 jobs in August, maintaining the labor market’s remarkable resiliency amid a contracting economy. The unemployment rate rose to 3.7%, up from last month's 3.5%. The gain followed an uptick in the labor participation rate, which expanded from 62.1% to 62.4%. Wages continued to grow, rising 0.3% in August and 5.2% from 12 months ago. 5
Sectors seeing the most significant increases in new jobs were professional and business services, healthcare, and retail. Lagging sectors were manufacturing, financial, and wholesale trade.6
This Week: Key Economic Data
Tuesday: Institute for Supply Management (ISM) Services Index.
Thursday: Jobless Claims.
Source: Econoday, September 2, 2022
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
This Week: Companies Reporting Earnings
Thursday: Zscaler, Inc. (ZS), Docusign (DOCU).
Friday: The Kroger Co. (KR).
Source: Zacks, September 2, 2022
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
HCM-BuyLine® Trend Weakening As Powell Startles The Markets
After Fed Chair Powell’s speech last week, he sent the markets into a tailspin. We are now oversold; the markets are trading in sawtooth patterns which is stocks moving higher and then pulling back as traders take part of the gains and resetting. We never expected a V-shaped recovery. I stated last week “The odds of us retesting the July lows are very low and the odds...[READ MORE]7
This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice.
What to Do If You Get an Identity Theft Letter From the IRS
The IRS can scan tax returns for potential fraud, and if a tax return seems suspicious, they will flag it for further review. In these cases, the IRS will send the taxpayer a letter notifying them of potential identity theft. Because the tax return won’t be processed until you respond to the letter, it’s essential to follow the steps outlined. The letter will likely have everything you need to know.8
The three different types of identity theft letters that the IRS may send out include:
- A letter that asks the taxpayer to verify their identity online
- A letter that asks the taxpayer to call the IRS to verify their identity
- A letter that asks the taxpayer to verify their identity in person.
* This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Zentangles Are a Fun and Creative Way to Destress
Doodling is a great way to relax and destress for a few minutes, and Zentangles take doodling to the next level. They are fun and easy to learn. You can create some fantastic little pieces with just a few techniques.
Zentangles are made from smaller patterns pieces together. The designs can be as simple as little circles, lines, and curves. Together, they can make a whole picture! You can add shading and contrast to accentuate your design. The idea behind Zentangles is to decompress and relax while creating an excellent, unique layout.9
Baked Eggs & Roasted Cherry Tomatoes
Total time: 25 mins
Yield: serves 4
- 3 cups (about 16 ounces) sweet cherry tomatoes or grape tomatoes, halved
- ¼ cup grated Parmesan
- 2 tablespoons olive oil
- 2 tablespoons plus 1 teaspoon chopped fresh basil leaves
- 1 garlic clove, pressed or minced (optional)
- Sea salt, preferably of the flaky variety
- Freshly ground black pepper
- 4 eggs, at room temperature
- Preheat oven to 400 degrees Fahrenheit.
- Arrange the halved tomatoes in an even layer in a medium-sized baking dish or oven-proof skillet. Bake the tomatoes for 12 minutes, then remove the dish.
- Top the tomatoes with all of the Parmesan, drizzle on the olive oil, sprinkle with 2 tablespoons basil and season with salt and pepper. Stir the garlic into the mixture, if using. Gently crack an egg over the tomatoes, keeping the yolk intact. Repeat with the remaining eggs, dispersing them somewhat evenly over the dish.
- Return the dish to the oven and bake for 8 to 10 minutes. Check at 8 minutes—you’re done when the egg whites have set but the yolks are still soft. They should still jiggle in the centers when you shimmy the pan. (Keep in mind that they’ll continue cooking after you pull the dish out of the oven.) Sprinkle the cooked eggs with salt, pepper and the remaining 1 teaspoon basil.
- Serve right away in shallow bowls with toast.
Footnotes and Sources
1. The Wall Street Journal, September 2, 2022
2. The Wall Street Journal, September 2, 2022
3. The Wall Street Journal, September 2, 2022
4. The Wall Street Journal, August 29, 2022
5. CNBC, September 2, 2022
6. CNBC, September 2, 2022
7. howardcm.com, August 31, 2022
8. IRS.gov, April 12, 2022
9. Zentangle.com, May 26, 2022
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.
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