Market Minute with Kenny Polcari: Feb. 13, 2023
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| By Kenny Polcari |
Welcome to another episode of Wealth & Wisdom! Let's get right down to business today by discussing what happened last week.
Let's get the bad news out of the way first. Last week was the worst week for the Treasury market in 2023, and it was a direct result of investors finally coming to grips with the fact that the Federal Reserve may have to remain more aggressive than expected.
In fact, that's the narrative that every Fed member has been repeating for weeks, but it seems the market is finally accepting it now. There's even talk in the industry of the Fed pushing rates to 6% in order to reach the terminal rate, based on how inflation and the economy respond.
Although the Treasury markets had a tough week, it was not quite a bad week for stocks. We did see a good amount of volatility, but by Friday, the Dow Jones Industrial Average ended the day higher by 175 points, while the S&P 500 was up by nine points.
This puts all the indices in positive territory so far for the year — the Dow Industrials is up just over 2%, the S&P 500 is up 6.5%, the Nasdaq is close to 12% and the Russell 2000 is up 9%.
Now, it's time to take a look at …
The Week Ahead
This is an interesting week for macroeconomic data vs. the micro, which are earnings reports, as we near the end of earnings season.
So far, we've seen about 69% of reported companies have beaten the estimates — a bit below what the historical averages have been, which are somewhere between 74%–75%.
While we have the remaining earnings reports coming out this week, the most important thing to look out for this week will be the economic data.
This Tuesday, we'll be getting the Consumer Price Index report; this one is going to be very closely watched because the month-over-month number is expected to be up five-tenths of a percent, suggesting that inflation is still a bit stubborn. However, the year-over-year number is expected to go down to 6.2% from 6.5%, which would mark the seventh consecutive month it's fallen.
In addition to the CPI, we get the retail sales and real average hourly wages and will see what those two numbers have to say about the pressure on wages.
I go into more detail about what data to watch out for this week, the expectations and what they all mean down below, so don't miss out:
Click here to view the video.
Click here to get my rundown and be sure to check your inboxes tomorrow for the next installment of my weekly video interview series, Wealth & Wisdom.
To your Wealth & Wisdom,
Kenny Polcari
Host
