Will the Fed Raise Interest Rates?

Concerns that the Fed may raise interest rates soured investor sentiment, sending stocks lower in a holiday-shortened trading week.

The Dow Jones Industrial Average slipped 0.75%, while the Standard & Poor’s 500 declined 1.29%. The Nasdaq Composite index dropped 1.93% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, lost 1.28%.^1,2,3

Stocks Resume Their Decline

Stocks were bedeviled by rising bond yields and higher oil prices last week, with technology shares bearing the brunt of the decline. Hopes that the Fed may not find it necessary to raise interest rates were dented by economic data reflecting higher prices, rising labor costs, and fewer-than-forecast initial jobless claims. 

The inflationary implications of higher oil prices also contributed to the growing sense that the Fed may implement additional rate hikes. While bond traders generally still expect no rate hike in September, the likelihood of a 0.25% rate hike or higher in November jumped to 43.3% by Friday morning from 35.4% a week ago.⁴

Oil Prices Spike

Last week, Saudi Arabia and Russia announced they would extend their oil production cuts to the end of the year. Investors had expected these cuts to be stretched to October, so the three-month extension surprised the markets.

The announcement sent oil prices higher on supply shortage worries in the coming winter months, with the West Texas Intermediate (WTI) oil price climbing to a 10-month high.⁵

Higher oil prices also sparked concerns that it would make the Fed’s inflation fight more difficult, potentially forcing the Fed to hike rates above market expectations.

This Week: Key Economic Data

Wednesday: Consumer Price Index (CPI).

Thursday: Jobless Claims. Producer Price Index (PPI). Retail Sales.

Friday: Consumer Sentiment. Industrial Production.

_{^{Source: Econoday, September 8, 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

Thursday: Adobe, Inc. (ADBE)

_{^{Source: Zacks, September 8, 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.}}

Give Back to Your Community By Working as a Tax Volunteer

If you want to give back to your community and help people with low to moderate incomes, consider applying to volunteer with the Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) programs. These programs offer free tax help to senior citizens, persons with disabilities, and those who speak limited English to understand their tax situations.

Here are some of the perks of being a VITA or TCE volunteer:

• Flexible hours: Generally, volunteers contribute 3-5 hours per week. Some sites are open all year, but most programs are available from January–April.
  
  
• Convenience: Thousands of VITA and TCE sites exist in neighborhoods across the country, so it's convenient to volunteer at a location close to you. Usually, these locations are in community centers, libraries, schools, and malls.
  
  
• No experience needed: You don't have to be a tax pro to volunteer because all volunteers receive special training and can serve in various roles.

What to Look for on a Nutrition Label

Nutrition labels contain helpful information that can guide you in the right direction as you eat healthier. But do you know how to read one correctly? The serving size is the first thing you will see on a nutrition label. This guide shows you how many calories a single serving of food contains.

The following section spells out the nutrients. This section helps you determine the nutritional value of a food. Pay close attention to the saturated fat and added sugar on the label. Lastly, you have the % daily value (DV), the percentage of each nutrient in a single serving in terms of the recommended amount.

Pumpkin Rigatoni with Rosemary Walnut Crispies

Servings: 6

PREP TIME: 15 mins | COOK TIME: 30 mins | TOTAL TIME: 45 mins

Pumpkin Rigatoni:  

• 2 tablespoons butter
• 4 cloves garlic, thinly sliced or minced
• 1 cup pumpkin puree
• 1 cup chicken or vegetable broth
• 1 cup heavy cream
• 1–2 teaspoons kosher salt
• squeeze of lemon
• 1 lb. rigatoni

Rosemary Walnut Crispies:

• 2 tablespoons turbinado sugar, for sprinkling, optional
• 1 cup walnuts, chopped
• 1 tablespoon finely chopped fresh rosemary leaves
• 1 tablespoon melted butter
• 1–2 tablespoons brown sugar (I like 2)
• 1/2 teaspoon kosher salt (more to taste)
• black pepper to taste

Instructions:

1. Rosemary Walnut Crispies: Preheat oven to 375 degrees. Run the walnuts through a food processor until they have a chopped texture. Arrange chopped walnuts on a small sheet pan and toast in the oven for 8-10 minutes. Remove from the oven and toss with rosemary, butter, sugar, salt, and pepper. Set aside to cool.
2. Pasta: Cook according to package directions. Drain.
3. Pumpkin Alfredo Sauce: While the pasta cooks, heat the butter in a skillet over low heat. Add the garlic and saute until fragrant (do not brown the garlic – it tastes bitter). Add the pumpkin and broth; simmer until smooth. Add the cream and salt; simmer until the sauce coats the back of a spoon. Add a little squeeze of lemon juice if you’re into that. Add cooked pasta to the sauce.
4. Assemble: Serve pasta in shallow bowls with a sprinkle of the walnut crispies on top, and a little sprig of rosemary for a fancy garnish if, you know, you’re fancy.
   
   

Notes: Vegan Version: Use olive oil in place of the butter, and full-fat coconut milk in place of the cream. (The vegan version is not quite as rich but it’s really, really good.)

Footnotes and Sources

^{1. The Wall Street Journal, September 8, 2023}

^{2. The Wall Street Journal, September 8, 2023}

^{3. The Wall Street Journal, September 8, 2023}

^{4. CME Group, September 8, 2023}

^{5. Reuters, September 5, 2023}

^{6. IRS.gov, January 11, 2023}

^{7. American Heart Association, 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.}