In a holiday-shortened trading week, stocks rallied despite mixed economic data and vacillating energy prices and bond yields.
The Dow Jones Industrial Average increased 0.77%, while the Standard & Poor’s 500 rose 1.94%. The Nasdaq Composite index picked up 4.56% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, edged 0.46% higher.1,2,3
Stocks Move Higher
In advance of Friday’s much-anticipated employment report, stocks enjoyed successive daily gains despite ongoing concerns about a recession. Recession fears were supported by an inversion in the yield curve and updated second-quarter Gross Domestic Product projections indicating the economy is ready to contract.
Technology shares were the week’s big winners as investors appear to have turned to companies with earnings growth potential during a weakening economic environment. Stocks bounced along the flatline following the strong jobs report on Friday to close out a positive week.
Employment’s Mixed Signal
One of the holes in the "imminent-recession" narrative has been the labor market's strength. Historically, recessions have been preceded by or concurrently with a weakening jobs market.
Friday's employment report reflected a job market that continues to belie Wall Street's recession fears. Employers added 372,000 jobs in June, a number that was above economists' estimates of 250,000. Wage gains were robust (+5.1% year-over-year), though still below the inflation rate. The unemployment rate was unchanged at 3.6%.4
This Week: Key Economic Data
Wednesday: Consumer Price Index (CPI).
Thursday: Producer Price Index (PPI). Jobless Claims.
Friday: Retail Sales. Industrial Production. Consumer Sentiment.
Source: Econoday, July 8, 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
Wednesday: Delta Air Lines, Inc. (DAL).
Thursday: JPMorgan Chase & Co. (JPM), Morgan Stanley (MS), Conagra Brands (CAG).
Friday: UnitedHealth Group (UNH), Citigroup, Inc. (C), Wells Fargo & Company (WFC), BlackRock, Inc. (BLK), U.S. Bancorp (USB), The PNC Financial Services Group, Inc. (PNC).
Source: Zacks, July 8, 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.
The Small Business Health Care Tax Credit
In an effort to extend health care benefits to more people, the IRS introduced the small business healthcare tax credit. This credit may benefit employers that have fewer than 25 full-time equivalent employees, offer a qualified health plan through a Small Business Health Options Program Marketplace, and pay at least 50% of the cost of the employee-only health care coverage. There may also be some average wage requirements.
The maximum credit covers:
- 50% of premiums paid for small business employers
- 35% of premiums paid for small tax-exempt employers
The credit may also be available for two consecutive taxable years.5
* 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.
Games to Exercise Your Brain
Brain training is a great way to keep your mind sharp and these fun games are designed for people of all ages. Improve your mental fitness with games like:
- Sudoku - This strategy game requires you to find the correct order of numbers 1-9 in a 3x3 grid. There can only be one of each number in each row and column.
- Crossword Puzzles - Find the correct word for each clue. The words intersect and share letters, so you have to make sure you have the right word, otherwise the puzzle won’t fit!
- Peak - Peak is a brain training app that you can play on your phone or tablet. It has a number of different games designed to improve cognitive function and problem-solving.6
Roasted Plum Compote
Total Time: 30 mins
Yield: 4 servings
- 1 lb ripe, yet firm Italian plums (or other small varieties) halved and pitted
- ½ teaspoon ground cinnamon for sprinkling (see notes for spice substitutions)
- 1 tablespoon pure honey
- 1 teaspoon pure vanilla bean paste or extract
- Preheat oven to 375°F (190°C) with a rack in the center position.
- Place the plum halves cut-side up in a 2-quart capacity baking dish (or alternatively, an 8-inch square baking pan) and spread into an even thin, tighlty packed layer. It is ok if they slightly overlap, but try to mostly keep them in a single layer.
- Sprinkle ground cinnamon over the plum halves, then drizzle the honey evenly across the fruit. Bake for 15 minutes, or until the plums have softened slightly, and gently toss with a spoon. Continue baking for an additional 5 to 15 minutes, or until the plums are soft and syrupy, yet still intact. Total baking time will vary depending on the size and ripeness of your fruit.
- Set aside on rack to cool - the liquid will become thicker and more syrupy as it cools. Stir in vanilla paste or extract, if using. Transfer compote to a container and store in the fridge for up to a week. Best served with yogurt or on top of ice cream, pancakes, or waffles.
Footnotes and Sources
1. The Wall Street Journal, July 8, 2022
2. The Wall Street Journal, July 8, 2022
3. The Wall Street Journal, July 8, 2022
4. CNBC, July 8, 2022
5. IRS.gov, July 30, 2021
6. verywellmind.com, August 6, 2021
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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