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M Notes: Mon, 2-5 Thumbnail

M Notes: Mon, 2-5



Week Close:
2-2-24
+ (-)%Jan
%
Dow38,654+545+1.4%+1.2%
S&P4,959+68+1.4%+1.6%
Nasdaq15,629+174+1.1%+1.0%
10-year4.02-0.12-2.9%+21.6%
Oil72.28-5.95-7.6%+5.9%


LAST WEEK:  

Markets:  “Not so fast, my friend.”  The Federal Reserve pulls a Lee Corso.  

S&P roller coaster last week:  Up, Down a touch, Down significantly, Up, and Up a lot.  

Fed Balance Sheet:  $7.630 trillion (last week… up -$47 billion).  Reminder: their balance sheet was closer to $4 trillion before the Pandemic. 

Fed Meeting:   During the college football season, Lee Corso has been a fixture on ESPN’s College Game Day.  At the end of each three hour show a group gets together to give their picks.  When the pickers agree with Lee, they get a “great pick” from him.  But when they disagree, they get a “Not so fast, my friend”.   The FOMC didn’t lower their interest rate, as many have been calling for.  Further, Federal Reserve Chair Jerome Powell said the Fed wouldn’t lower interest rates at their March meeting.  That made news.  And Markets went down significantly on Wednesday afternoon.  So now the question of course is… just when will the Fed begin lowering their interest rate?   

ISM:  Their Manufacturing index rose from 47.1 up to 49.1.   A number below 50 implies a contraction, while a number above 50 implies an expansion.  

Jobs:  The Jobs number beat in two ways.  The 216,000 from the last read (Dec) was revised from 216,000 up to 333,000. The consensus for January was about 170,000, but the actual number came in at 353,000 (a significant beat).  

Jobless claims:  The weekly number came in at 224,000.  The four-week average came in at 208,000.

Radio:  Bill was off last Friday.  You can hear Bill and I talk about Markets and the Economy most Friday mornings at 6:40am, 7:40am, and 8:40am on WTAM 1100 AM.  

Unemployment:  The U3 Unemployment rate remained at 3.7%.  

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THIS WEEK:

Focus of the week:   Fed Chair Jerome Powell was on 60 Minutes last night.  He said the Federal Reserve will proceed carefully with rate cuts this year.  Economic updates are limited this week so this week’s focus will be on corporate earnings reports and forecasts (as well as conjecture about the Fed).

Calendar:   ISM Services index (Mon); trade deficit (Wed);  and jobless claims (Thu).   

Earnings season:  It continues.   Some of the companies reporting this week:  Amgen, BP, Caterpillar, Chipotle, ConocoPhillips, CVS, Disney, Eli Lilly, Ford, Honda, McDonald’s, Pepsi, Philip Morris, Siemens, Toyota, and Uber.