Stocks remained resilient last week amid mixed earnings reports, hawkish Fed-speak, and lingering recession fears, closing out the five trading days with small losses.
The Dow Jones Industrial Average slipped 0.23%, while the Standard & Poor’s 500 lost 0.10%. The Nasdaq Composite index fell 0.42% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, added 0.10%.1,2,3
Stocks Hold Firm
Stocks traded most of last week around the flatline as investors grappled with several headwinds.
The first was disappointing earnings results, coupled with the absence of earnings guidance from some companies due to an uncertain economic climate. Weak economic data, including declines in housing and leading economic indicators, also weighed on investor sentiment. Finally, multiple Fed officials spoke last week, signaling that inflation remained too high and that further rate hikes may be likely.
Underneath the seemingly placid surface of the major market indices, there was substantial price action at the individual stock and sector level. Poor earnings results hit communication services stocks and regional banks, while margin pressures put pressure on auto stock valuations.
Housing Weakness
Two housing reports reflected ongoing fragility in the housing market and fed prevailing economic slowdown worries.
Sales of new homes fell 0.8% in March, dragged down by a 5.2% slide in new multi-family home construction. Sales of single-family homes were a bright spot, rising 2.7% to a three-month high, though that hopeful note was tempered by an 8.8% drop in new application permits–an indicator of future new home building.4
Existing home sales also suffered a month-over-month decline in March, falling 2.4%. Sales plummeted 22% from March 2022 levels as higher mortgage rates and tight inventories impacted affordability.5
This Week: Key Economic Data
Tuesday: Consumer Confidence. New Home Sales.
Wednesday: Durable Goods Orders.
Thursday: Gross Domestic Product (GDP). Jobless Claims.
Friday: Personal Income and Outlays. Consumer Sentiment.
Source: Econoday, April 21, 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: The CocaCola Company (KO).
Tuesday: Microsoft Corporation (MSFT), General Electric Company (GE), Verizon Communications, Inc. (VZ), Visa, Inc. (V), Alphabet, Inc. (GOOGL), General Motors Company (GM), McDonald’s Corporation (MCD), Ameriprise Financial, Inc. (AMP), 3M Company (MMM), Texas Instruments, Inc. (TXN), United Parcel Service, Inc. (UPS), PepsiCo, Inc. (PEP), NextEra Energy, Inc. (NEE), Spotify Technology (SPOT), Kimberly-Clark Corporation (KMB).
Wednesday: The Boeing Company (BA), ServiceNow, Inc. (NOW), Thermo Fisher Scientific, Inc. (TMO), General Dynamics Corporation (GD), eBay, Inc. (EBAY), Boston Scientific Corporation (BSX), Norfolk Southern Corporation (NSC).
Thursday: Amazon.com, Inc. (AMZN), Intel Corporation (INTC), AbbVie, Inc. (ABBV), Mastercard, Inc. (MA), Bristol Myers Squibb Company (BMY), Caterpillar, Inc. (CAT), Merck & Co., Inc. (MRK), The Southern Company (SO), Eli Lilly and Company (LLY), Northrop Grumman Corporation (NOC), Comcast Corporation (CMCSA).
Friday: Exxon Mobil Corporation (XOM), Chevron Corporation (CVX), Charter Communications, Inc. (CHTR).
Source: Zacks, April 21, 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.
Tax Benefit and Credits: FAQs for Retirees
Lots of questions can come up about income taxes after retirement. Listed are answers to just a few common questions from retired taxpayers.
What types of income are taxable?
Some common types of taxable income include military retirement pay, all or part of pensions and some retirement accounts, unemployment compensation, gambling income, bonuses and awards for work, and alimony or prizes.
What types of income are non-taxable?
A few examples of non-taxable income are veteran’s benefits and disability pay for specific military or government-related incidents, worker’s compensation, and cash rebates from a dealer or manufacturer of an item you purchased.
Why is my pension taxed?
It might depend on how the money was put into the pension. For example, if the money was not taxed before going into the plan, it may be taxable. Conversely, if your contribution is from already-taxed dollars, that portion of the pension may not be taxed.6
*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.
Practicing Gratitude
Psychologists have defined gratitude as a positive emotional response to receiving a benefit from someone or something. In positive psychology, gratitude is the human way of acknowledging the good things in life. Thankfully, you can learn gratitude if it does not come innately.
There are benefits to practicing gratitude, especially in times of stress and uncertainty. Gratitude invites positive emotions that can have physical benefits through the immune or endocrine systems. Research shows that when we think about what we appreciate, the parasympathetic or calming part of the nervous system is triggered, which can have protective benefits for the body—including decreasing levels of the stress hormone cortisol and increasing oxytocin, the bonding hormone involved in relationships that make us feel good.7
There are a few great ways to get started today and practice gratitude in your own life:
- Write thank you notes
- Keep a gratitude journal
- Follow-up with family and friends
- Give back to your family, friends, and community
- Pay kindnesses forward
Strawberry Pound Cake
Servings: 8
Time: 1 hr. 10 mins
Tender and juicy strawberries are baked right into this lighter Pound cake made with NO BUTTER and using greek yogurt instead! Topped with a drizzle of cream cheese glaze.
Ingredients:
- 1 cup white granulated sugar
- 1 and ½ cup all purpose flour
- ¼ teaspoon salt
- 2 teaspoons baking powder
- 1 cup vanilla greek yogurt
- ½ teaspoon vanilla extract
- 3 large eggs
- ½ cup vegetable oil
- 1 cup diced strawberries
- 1/2 tablespoon all purpose flour
Cream Cheese Glaze:
- 2 ounces cream cheese room temperature
- 1/4 cup powdered sugar sifted
- 2 tablespoons milk
Directions:
- Preheat oven to 350 degrees Spray loaf pan (mine is 9×5) with baking spray and set aside.
- In large bowl mix together the flour, salt, baking powder, and sugar. Whisk together to combine.
- In another medium bowl beat the eggs, add in the greek yogurt, vanilla extract, vegetable oil, stir until combined.
- Pour the wet ingredients into the dry and stir gently to mix.
- Toss the strawberries with the ½ tablespoon of flour. Once batter is mostly mixed, gently fold in the strawberries.
- Pour the batter into the loaf pan. Using the back of the spoon evenly spread the batter.
- Bake for approximately 60 minutes. Top will be browned and a toothpick inserted into the middle will come out clean once done. Allow to cool in pan for about 10 minutes then turn the pan upside down to remove the bread from the pan. Move loaf to wire rack to continue cooling.
- While bread is cooling you can prepare the glaze. In small bowl beat the cream cheese until smooth and creamy. Add in the powdered sugar and milk. Stir to combine. Should be a smooth consistency. Add more sugar or milk to reach desired consistency.
- Pour the glaze over the cooled bread.
- Serve immediately or store bread in sealed container. I wrap mine in foil. Store at room temperature for 3-4 days.
Footnotes and Sources
1. The Wall Street Journal, April 21, 2023
2. The Wall Street Journal, April 21, 2023
3. The Wall Street Journal, April 21, 2023
4. YahooFinance, April 18, 2023
5. CNBC, April 20, 2023
6. IRS.gov, 2023
7. Mindful.org, February 7, 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.