Stocks Have Warmer Week as Inflation Cools

Stocks Have Warmer Week as Inflation Cools

August 15, 2022
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An improving inflation outlook buoyed investors’ spirits last week, helping lift stocks to solid gains.

The Dow Jones Industrial Average advanced 2.92%, while the Standard & Poor’s 500 rose 3.26%. The Nasdaq Composite index added 3.08% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, gained 2.39%.1,2,3


Lower Inflation Spurs Buying

Stock prices surged mid-week when the U.S. Bureau of Labor Statistics released a better-than-expected Consumer Price Index (CPI) number, with buying momentum building throughout the trading session.

Gains were significant across the board, with technology and small-cap companies leading the market higher. The mid-week rally sent the S&P 500 to its highest level since May and the Nasdaq to its highest level since April. Bond yields fell on expectations that the Fed's pressure to hike rates further might ease. After pausing on Thursday, stocks again ripped higher on Friday, aided, in part, by a report indicating improving consumer sentiment.4

Inflation Cools

The Consumer Price Index in July was softer than expected, with prices unchanged from the previous month thanks to a 4.6% decline in energy prices and a 7.7% drop in gasoline.4

Despite the encouraging results, the CPI report still evidenced upward price pressure. The year-over-year inflation rate remained at 8.5%, while the core CPI (excluding food and energy) came in at 5.9%. Among the index components seeing substantial price increases were food (+10.9% from 12 months ago) and shelter (+5.7%). Producer prices fell 0.5% in July, suggesting that future consumer price increases may continue to moderate.5,6

This Week: Key Economic Data

Tuesday: Industrial Production. Housing Starts.

Wednesday: Retail Sales. Federal Open Market Committee (FOMC) Minutes.

Thursday: Jobless Claims. Existing Home Sales. Index of Leading Economic Indicators.

Source: Econoday, August 12, 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

Tuesday: Walmart, Inc. (WMT), The Home Depot, Inc. (HD).

Wednesday: Cisco Systems, Inc. (CSCO), Target Corporation (TGT), Lowe’s Companies, Inc. (LOW), The TJX Companies, Inc. (TJX).

Thursday: Applied Materials, Inc. (AMAT), NetEase, Inc. (NTES).

Friday: Deere & Company (DE).

Source: Zacks, August 12, 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.


Fortune Favors the Bold, but Caution is Still Warranted

The short-term and intermediate-term trends of the market have turned up; and the long-term trend is still negative but has dramatically improved. The market is overbought and a 3-5% pullback is warranted and could take place over the next few weeks. This will be an area to add to existing positions as well as...[READ MORE]

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. 




Help Get Your Federal Withholding Correct With This Tool From the IRS

The IRS has a handy tool called the IRS Tax Withholding Estimator that can help taxpayers better understand their withholding. It’s essential to examine your federal withholding periodically to ensure you are comfortable with the amount of tax withheld.8

Checking your withholding status may be a good idea to consider if you have experienced a change that may affect your tax status, such as:

  • Going through a marriage or divorce
  • Having or adopting a child
  • Purchasing a new home
  • Working two or more jobs at the same time
  • Only working part of the year
  • Claiming credits such as the child tax credit

* 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.


What is Sleep Hygiene?

We all want a better night’s sleep, and your sleep hygiene routine might impact the amount and quality of shut-eye you get. Sleep hygiene refers to your habits to get a good night’s sleep. The better your habits, the better your chances are of improving your sleep.9

Here are some good sleep hygiene tips:

  • Be consistent with your sleeping and waking times, even on weekends!
  • Make sure your bedroom is dark, quiet, and of a comfortable temperature.
  • Invest in blackout curtains or a white noise machine to drown out light and sound.
  • Avoid electronic devices, including phones and TV, at least an hour before bed.
  • If your appliances have a “night” mode, switch this on a few hours before bed to reduce blue light.
  • Make sure to get enough exercise during the day, which may help you fall asleep faster.


Strawberry Watermelon Feta Salad

Prep time: 10 mins

Yield: serves 6

    Ingredients:

    •  3 cups strawberries
    •  3 cups cubed watermelon
    •  2 avocados, diced (optional)
    •  4 ounces arugula (optional)
    •  2 Persian cucumbers
    •  1 cup feta, cubed
    •  8-9 mint sprigs, chopped
    •  ¼ cup chopped pistachio (or sliced almonds)

    Dressing:

    • ¼ teaspoon kosher salt
    • 2 tablespoons lime juice + the zest of 1 lime
    • 2 teaspoons sugar
    • ¼ cup olive oil

    Instructions:

      1. DRESSING: In a small bowl, combine all the ingredients listed in a small bowl. Whisk it together and set it aside for now. If the dressing separates at any point, simply whisk to combine.
      2. TOSS AND SERVE: Keep dressing and salad separate if you aren’t serving immediately. Add the arugula to the bottom of a large bowl. Top with watermelon, strawberries, avocados, cucumbers, feta, mint, and pistachios. Dress the salad with half of the dressing and toss to combine. Taste and adjust with more dressing as desired. Serve once dressed.


    Footnotes and Sources


    1. The Wall Street Journal, August 12, 2022

    2. The Wall Street Journal, August 12, 2022

    3. The Wall Street Journal, August 12, 2022

    4. CNBC, August 10, 2022

    5. CNBC, August 10, 2022

    6. CNBC, August 11, 2022

    7. howardcm.com, August 2, 2022

    8.  IRS.gov, April 28, 2022

    9. CDC.gov, 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.

    Copyright 2022 FMG Suite.

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