Stocks ended the week roughly where they began as investors digested a mixed set of new economic data.
The Dow Jones Industrial Average gained 0.12%, while the Standard & Poor’s 500 slipped 0.16%. The Nasdaq Composite index fell 0.39% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, added 1.23%.1,2,3
Stocks Struggle for Direction
Stocks traded around the flatline without any catalyst in either direction. On Thursday, investors welcomed the European Central Bank, signaling its rate-hiking campaign may be nearing its conclusion and a successful IPO that revived optimism in the capital markets. Investors also cheered a stronger-than-forecast retail sales report and a modest increase in core producer prices, overlooking a higher-than-expected headline number.
But sentiment quickly reversed on Friday as a drop in consumer confidence, troubling news in the semiconductor space, and a labor strike at the nation’s major automakers dented Thursday’s optimism, sending major averages to a mixed close for the week.
Inflation Progress Stalls
Surging gasoline prices drove August’s inflation rate to its highest monthly rate this year, rising 0.6%, while the year-over-year Consumer Price Index posted a 3.7% increase, up from July’s 3.2% annual rate. Core inflation (excludes energy and food) was more encouraging, rising 4.3%-- down from July’s reading of 4.7%.4
Producer prices also came in higher than expected, rising 0.7% in August, above the estimate of a 0.4% increase and the biggest monthly gain since June 2022. The year-over-year increase was a more modest 1.6%. Gasoline prices significantly contributed to the month’s jump; excluding food and energy, prices aligned with forecasts, ticking up 0.2% in August.5
This Week: Key Economic Data
Tuesday: Housing Starts.
Wednesday: FOMC Announcement.
Thursday: Jobless Claims. Existing Home Sales. Index of Leading Economic Indicators.
Friday: Purchasing Managers’ Index (PMI) Composite Flash.
Source: Econoday, September 15, 2023
This Week: Companies Reporting Earnings
Tuesday: AutoZone, Inc. (AZO)
Wednesday: FedEx Corporation (FDX), General Mills, Inc. (GIS)
Thursday: Darden Restaurants, Inc. (DRI)
Source: Zacks, September 15, 2023
For those collecting Social Security, the Social Security cost-of-living adjustment may be 3.2% in 2024, according to one analyst — in stark comparison with the 2023 rate, which was close to 9%. We'll have a definite answer of the exact amount of the 2024 Social Security COLA on Oct. 12, when the final inflation numbers of the third quarter of 2023 are released.
|Have a great week everyone and a great start to fall which is this Saturday! Sean, Trish, & Erin|
Canary Pine Tree Landscape at Cumbre Vieja Volcanic Area
Footnotes and Sources
2. The Wall Street Journal, September 15, 2023.
3. The Wall Street Journal, September 15, 2023.
4. The Wall Street Journal, September 13, 2023.
5. CNBC, September 14, 2023.
6. IRS.gov, January 31, 2023.
7. Harvard Medical School, August 8, 2023.
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Weekly Market Insights: Stocks Stand Still, Awaiting Fed
September 19, 2023|