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September 2023 - Market Update Despite recent optimism about declining inflation... The Consumer Price Index (CPI) recorded its largest monthly increase this year, up 0.6% in August.1 On an annual basis, prices rose 3.7%, compared to 3.2% in July.1 Core inflation, which excludes more volatile food and energy prices, rose 0.3% in August, marking the first acceleration in six months.1 Since February, year-over-year core inflation has consistently outpaced headline inflation, however, the silver lining is that core inflation continues to improve by falling to 4.3% in August, from 4.7% in July.1 Transportation-related items replaced shelter as the [...]

July 2023 - Market Update Stocks surged in the first half of the year driven by mega cap technology, or technology-adjacent, stocks. These top stocks have been dubbed the “Magnificent 7” by the media and include Apple, Amazon, Alphabet, Meta, Microsoft, NVIDIA, and Tesla. Together, those firms contributed nearly three-fourths of the S&P 500’s gains1. While headlines are telling the story of artificial intelligence fueling the surge of tech stocks, there are two additional storylines to consider. First, most of the “Magnificent 7” had a rough 2022. As fears of rapidly rising interest rates have subsided, technology [...]

June 2023 - Market Update Year-over-year inflation has improved in each of the last 11 months.While prices are still increasing faster than the Fed is comfortable with, as headline prices rose 4.0% over the last year through May, the rate of those increases continues to come down1. Core inflation, which excludes the volatile food and energy components, rose by 5.3%, marking the slowest rate since December 2021. Although the significant improvement in headline inflation provides some flexibility for the Federal Reserve, stubborn core inflation may significantly push out any easing the Fed may have been previously debating. While [...]

April 2023 - Market Update Consumers are the largest and most important part of the US economy, and their ability to drive it has been critical over the last year or so.Sentiment data has shown pessimistic views of the economy, but the tight jobs market has been a key point of the consumers’ resilience in the face of continuously rising prices. While jobs have continually grown over the last two years, the pace of growth has been slowly cooling. In March, over a quarter million new jobs were added to the economy1, though job openings fell below 10 [...]

March 2023 - Market Update Silicon Valley Bank (SVB) collapsed over a five-day period starting on March 8, 2023. The events were triggered by a run on the bank after it announced that it had sold securities at a loss and needed to raise $2.25 billion to plug the hole in its finances. SVB's bond portfolio, heavily invested in US government bonds during the era of near-zero interest rates, suffered when the Federal Reserve hiked interest rates aggressively to tame inflation. Rising borrowing costs for tech startups, which make up a majority of SVB’s depositors, forced them [...]

November 2022 - Market Update Recent positive economic developments include third quarter GDP rising at a 2.6% annualized rate.1 Also, inflation is showing some signs of slowing, with the yearly change in the Consumer Price index falling from 8.2% to 7.72%. The GDP report essentially puts to bed the discussion of currently being in a recession, though risks remain for next year as the impact of the Fed’s actions can take a while to ripple through the economy. Within October’s inflation report, goods prices fell by 0.4% over the month, while services prices continued to rise.2 The [...]

October 2022 - Market Update Another hot inflation report from September shows the Fed has a long road ahead to get inflation under control. The Consumer Price Index rose 0.4% for the month and 8.2% over the prior year1. While the annual increase is slightly slower than the 8.3% in August, there weren’t many silver linings in the report. Core inflation, which excludes food and energy, has grown 6.6% over the past year, the most since the early 1980s. The fact that inflation isn’t slowing down makes it increasingly likely the Federal Reserve will hike 75 basis [...]

September 2022 - Market Update August’s inflation surprised economists and the markets, and not the good kind of surprise. Lower gas prices helped somewhat, but the overall Consumer Price Index rose 0.1% over the month and 8.3% over the year1. A Bloomberg survey showed economists had expected prices to fall 0.1% and the direction of the surprise sent markets tumbling, with the S&P 500 falling over 4% the day the report was released. Lower gas prices were just about the only glimmer of good news since prices rose on most other major items and core prices, which [...]