Stocks retreated last week as bond yields increased following the Treasury's announcement indicating “a larger-than-expected funding need” and a downgrade in the federal government’s debt rating.
The Dow Jones Industrial Average dropped 1.11%, while the Standard & Poor’s 500 shed 2.27%. The Nasdaq Composite index lost 2.85% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, tumbled 3.27%.1,2,3
Stocks Struggle
Stocks struggled as investor sentiment turned cautious amid rising bond yields. Markets were rattled initially by news that the Treasury raised its borrowing requirement for the third quarter by more than a quarter of a trillion dollars and on news that the Bank of Japan announced it would allow bond yields to rise after years of capping them.
Rising yields continued to pressure stocks in the wake of a surprise rating downgrade of U.S. government debt by a major credit rating agency due to its belief in expected fiscal deterioration over the next three years.
Stocks rebounded Friday morning, rising on modest employment data only to reverse and add to the week’s losses.
Mixed Signals from the Labor Market
Fresh employment data last week gave some conflicting signals about the labor market. A new JOLTS (Job Openings and Turnover Survey) report showed a small decline in job openings and layoffs in June, leaving 1.6 job openings for each available worker.4
Automated Data Processing’s (ADP) employment report reflected strong private sector hiring with a 324,000 increase in jobs, exceeding the consensus forecast of a 175,000 gain.5
The government’s monthly employment report saw a cooling in hiring as employers added 187,000 jobs in July. This was slower than seen in the first six months but enough to shave the unemployment rate from 3.6% to 3.5%.6
This Week: Key Economic Data
Thursday: Consumer Price Index (CPI). Jobless Claims
Friday: Producer Price Index (PPI). Consumer Sentiment
Source: Econoday, August 4, 2023
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
Monday: Skyworks Solutions, Inc. (SWKS)
Tuesday: Eli Lilly and Company (LLY), Duke Energy Corporation (DUK), United Parcel Service, Inc. (UPS), ONEOK, Inc. (OKE)
Wednesday: The Walt Disney Company (DIS)
Source: Zacks, August 4, 2023
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.
Markets in a Bullish Landscape, but Beware of Speed Bumps
Last week we witnessed the market sell off hard on Thursday and rally back even stronger on the PCE news, which was very encouraging. The markets are clearly in an uptrend and look strong, but with that said, they are looking a bit frothy. A pullback is warranted and probably near-term, but it should be...[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.
Add Social Security Numbers of Your Dependents on Your Return
On your tax return, add the Social Security Numbers for your children and other dependents. Otherwise, the Internal Revenue Service (IRS) might deny any dependent credits you might be due, including the Child Tax Credit.
If you don’t have the number you need by the tax filing deadline, the IRS suggests filing for an extension rather than sending in a return without a Social Security number.8
*This information is not intended to substitute for specific individualized tax advice. We suggest you discuss your specific tax issues with a qualified tax professional.
4 Potential Health Benefits of Coffee
Coffee may help you live longer: Recent studies found that coffee drinkers are less likely to die from certain causes of death, including coronary heart disease, stroke, diabetes, and kidney disease.
Your liver may thank you: Research shows that coffee drinkers are more likely to have liver enzyme levels within a healthy range than people who don't drink coffee.
You may decrease your risk of getting Alzheimer's disease: The caffeine in two cups of coffee may protect against developing the condition. Researchers found that women aged 65 and older who drank two to three cups of coffee a day were less likely to develop dementia in general.
Your body may process glucose better: Studies have found that people who drink more coffee are less likely to have type 2 diabetes.9
Watermelon Salad with Whipped Feta
Servings: 6-8
TOTAL TIME: 20 mins
Fresh watermelon and cucumber are tossed with lemon and mint and served over a bed of silky whipped feta.
Ingredients:
- 5 to 6 cups diced seedless watermelon
- 3 Persian cucumbers, sliced
- quarter of a small red onion, very thinly sliced
- juice of 1 lemon (about 2 tablespoons)
- fine sea salt and freshly-ground black pepper
- 2 to 3 tablespoons finely-chopped fresh mint leaves
Whipped Feta Ingredients:
- 8 ounces feta cheese
- ½ cup plain Greek yogurt
- 2 tablespoons olive oil
Instructions:
- Whip the feta. Add the feta, Greek yogurt and olive oil to a food processor. Purée for 2 to 3 minutes, stopping occasionally to scrape down the sides of the bowl as needed, until the feta is silky smooth.
- Toss the watermelon salad. Add the watermelon, cucumber and red onion to a large mixing bowl. Drizzle evenly with the lemon juice, a pinch of salt and pepper, and toss very briefly to combine.
- Assemble. Spread the whipped feta out evenly on a serving plate. Top with the watermelon, cucumber and red onion, and sprinkle evenly with the chopped fresh mint and a few twists of black pepper.
- Serve. Serve immediately and enjoy!
Footnotes and Sources
1. The Wall Street Journal, August 4, 2023
2. The Wall Street Journal, August 4, 2023
3. The Wall Street Journal, August 4, 2023
4. CNBC, August 1, 2023
5. CNBC, August 2, 2023
6. The Wall Street Journal, August 4, 2023
7. howardcm.com, July 31, 2023
8. IRS.gov, October 7, 2022
9. John Hopkins Medicine, April 24, 2023
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 2023 FMG Suite.