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Happy Memorial Day! Hope you are all doing well and enjoying your holiday weekend. It was a week of starkly different results for the major U.S. stock indexes, with the Dow down more than 2%, the NASDAQ up more than 1%, and the S&P 500 posting a tiny gain. The Dow snapped a string of five positive weeks in a row and fell more than 900 points below the record-high 40,000-point threshold that it had breached the previous week. In honor of Memorial Day, I have broken down this week’s update using the fields of battle within Antietam. More Americans lost their lives at Antietam than any other battle in U.S. history but their sacrifice helped lead to the Emancipation Proclamation five days later.

Burnside Bridge

Getting oil inventories restored like taking the bridge at Antietam is an important first step in keeping old prices low. The price of oil fell around 2% for the week to its lowest level in more than three months after a report showed an increase in U.S. crude inventories. At Friday afternoon’s price of less than $78 per barrel, U.S. crude was down sharply from a year-to-date high of $87 in early April. The price at the pump will likely be an important issue at the ballot box so the price of oil bears watching.

Bloody Lane

The path to easing monetary policy took a hit this week. Investors continue to fight the Fed, predicting rate cuts despite the contradictory information we continue to get.   Wednesday’s release of minutes from the Fed meeting indicated an unspecified number of U.S. Federal Reserve policymakers indicated a willingness to tighten monetary policy further.  The Fed continues to monitor inflation risks and would not be opposed to further rate hikes if the inflation data warrants it. The minutes showed the prospect of an additional interest-rate increase was discussed by policymakers amid recently mixed inflation readings. Don’t be surprised if we see patches of volatility around the release of inflation data as the market continues to try to gauge what the Fed will do next

Final Attack Trail

The earnings season is coming to a close but this week we had one final tech company report earnings.  Nvidia was the story this week posting earnings Wednesday afternoon. Nvidia beat expectations, raised guidance, announced a 10-for-1 stock split, bought back billions worth of stock, and considerably boosted its dividend.  The run in Nvidia (up over 170% in the last 12 months) helps almost everyone because it accounts for almost 6% of the S&P 500.  So even if you don’t own shares of the stock directly you likely own the company through an index fund. The NASDAQ’s weekly outperformance relative to its peers was driven in part by another strong week for information technology stocks which rode Nvidia’s momentum. The tech sector is coming off a solid earnings season in which its earnings growth rate ranked third highest among the 11 S&P 500 sectors.

Reminder to my Federal Employee clients.  Laurel Wealth Solutions is sponsoring the upcoming Federal Executive Forum, June 12th in Washington D.C. The link is below. If you are interested in attending, my clients will receive a 20% discount on their registration fee using the discount code LWS20.

Contact Laurel Wealth Solutions if you’d like to speak about your investments or your plan. You can also reach Stephen Caruso directly by clicking the calendar link below and schedule an in person, phone, or zoom appointment at any time.