Stocks Weather Summer Storm of News and Indicators

Stocks extended their August declines last week as higher yields and weak economic data out of China soured investor sentiment.

The Dow Jones Industrial Average lost 2.21%, while the Standard & Poor’s 500 retreated 2.11%. The Nasdaq Composite index backtracked 2.59% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, slumped 2.83%.^1,2,3

Stocks Wilt

Rising bond yields, driven primarily by strong economic data and the release of the minutes from July’s Federal Open Market Committee (FOMC) meeting that pointed toward Fed officials’ potential need to raise rates further, weighed on stocks throughout the week.

In a week of light trading typical of August, stocks were additionally buffeted by a string of economic data that painted a flailing economic recovery in China and warnings of potential downgrades of dozens of U.S. banks by Fitch, a credit-rating agency.

After the 10-year Treasury yield rose to its highest level since October 2022 on Thursday, yields eased on Friday, helping to arrest the week’s downward trend.⁴

Retail Sales Surprise

Retail sales jumped 0.7% in July, the fourth-consecutive month of increasing consumer spending on goods. The report supported the growing narrative that the U.S. may be able to avoid a recession in the near term. The strong spending data, supported by a robust labor market, also may have placed the Fed in a more difficult position in trying to bring inflation down to its target rate without more rate hikes.⁵ 

Consumer spending was higher in most categories, including bars and restaurants, grocery and hardware stores, and back-to-school items like books and clothing. Sales of autos and electronics fell, a possible consequence of higher borrowing costs.⁵

This Week: Key Economic Data

Tuesday: Existing Home Sales.

Wednesday: Purchasing Managers’ Index (PMI) Composite Flash. New Home Sales.

Thursday: Durable Goods Orders. Jobless Claims.

_{^{Source: Econoday, August 18, 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: Zoom Video Communications, Inc. (ZM)

Tuesday: Lowe’s Companies, Inc. (LOW)

Wednesday: Nvidia Corporation (NVDA), Autodesk, Inc. (ADSK), Analog Devices, Inc. (ADI), Snowflake, Inc. (SNOW)

Thursday: Marvell Technology, Inc. (MRVL), Ulta Beauty, Inc. (ULTA), Workday, Inc. (WDAY), Dollar Tree, Inc. (DLTR)

_{^{Source: Zacks, August 18, 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.}}

Buying Opportunities Abound After Recent Pullback

The market has pulled back to the point where it should be considered buyable. The trend is still very strong, and the HCM-BuyLine® is positive. Pullbacks are healthy; markets always adjust and reset, even in a bull market. I would not be surprised to see a pretty good move back up in the last two...[READ MORE]⁶

^{_{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.}} 

Is it Time for a Paycheck Checkup?

There's no better time than the present to check your withholding status and make sure your paycheck accurately reflects the taxes you should be paying.

These paycheck checkups are a great practice when something happens in your life that may change your tax status, such as getting married or getting divorced, having a baby, getting a new job, or getting a raise or promotion at work. You can also adjust your withholding status if you want to change how much tax you withhold due to other circumstances.

During your paycheck checkup, you can also check other factors, such as how much you contribute to your health insurance or retirement plan. These expenses can also impact your tax liability.⁷

_{*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.}

5-Minute Core-Strengthening Workout

Even if you only have a little time to dedicate to a core workout, this circuit will get you going and only takes 5 minutes. Here are the moves:

• 1-minute high plank: Your hands are on the ground, your arms are straight, and you are holding your body up with your arms and a tight core.
• 30-second side plank on each side: One hand is on the ground, your arm is straight, and the other is in the air. You can do a side plank with your feet stacked on each other (most demanding), your feet staggered (a little easier), or your bottom knee on the ground.
• 1-minute boat poses: Your feet are in the air, and your arms are by your side, reaching to your feet. You can pose with your legs bent (easier) or straight out (harder).
• 1-minute crunches: Lift your shoulders and upper back off the ground without pulling your neck.
• 1-minute dead bug: Lay on your back and alternate, extending out the opposite arm and the opposite leg simultaneously.⁸

FRIED EGGPLANT RAGÚ WITH CREAMY POLENTA

Servings: 4

PREP TIME: 20 mins | COOK TIME: 30 mins | TOTAL TIME: 50 mins

Super savory fried eggplant ragú over creamy polenta. A naturally gluten-free and mega comforting meal.

Ragú Ingredients:  

• 1 pound eggplant
• 1 teaspoon fine sea salt
• 1/4 cup + 2 tablespoons olive oil
• 1/4 teaspoon black pepper
• 1/2 cup tomato sauce (Rao's Marinara Sauce recommended)

Polenta Ingredients:

• 1 teaspoon olive oil
• 1 clove garlic, minced
• 4 cups filtered water
• 1/4 teaspoon fine sea salt
• 1/4 teaspoon black pepper
• 1 cup polenta
• 1 tablespoon unsalted butter
• 1/2 cup grated Pecorino Romano (more to garnish)

Instructions:

1. Slice the eggplant into 1/2 inch thick medaillions. Lay it out on a tea towel and sprinkle with the salt. Allow it to sit for 15 minutes, then rinse and pat dry. Then dice it into small 1/4 inch cubes.
2. Heat a skillet over medium high heat and pour in the olive oil. Add the eggplant and allow it to cook undistrubed for 7 minutes or until golden brown. Flip the eggplant and cook for another 5 minutes or until golden brown.
3. Sprinkle on the black pepper and stir in the tomato sauce. Reduce the heat to low and simmer uncovered for 5 minutes. Remove the ragú from the heat and set aside.
4. In a large nonstick frying pan heat the olive oil garlic over low-medium heat and sauté for one minute. Add in the water, salt and pepper and bring to a boil.
5. Then add in the polenta one-third cup at a time, stirring constantly to avoid clumps. Reduce the heat to a simmer and cook uncovered for about 15 minutes while stirring frequently until the water is absorbed and the polenta is soft. Add in more water occasionally if needed.
6. Remove from the heat and stir in the butter and cheese. Taste and add more salt and pepper if desired. To serve family style scoop polenta into a serving bowl and top with fried eggplant ragú.

Footnotes and Sources

^{1. The Wall Street Journal, August 18, 2023}

^{2. The Wall Street Journal, August 18, 2023}

^{3. The Wall Street Journal, August 18, 2023}

^{4. CNBC, August 18, 2023}

^{5. The Wall Street Journal, August 15, 2023}

^{6. howardcm.com, August 14, 2023} 

^{7. IRS.gov, April 10, 2023} 

^{8. Mind Body Green Movement, 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.}