MARKET OVERVIEW, RESULTS & WEEK AHEAD
The Dow, S&P 500, & the Nasdaq posted moderate weekly gains again this week and set new records further fueling some analysts’ predictions of a market pullback or at least increased volatility. The Russell 2000 was off -0.5.
The minutes from the September FOMC meeting were released with little to add as the Fed maintains its stance of continued gradual rate hikes with an eye on inflation. The Consumer Price Index (CPI) increased less than expected in September but was the biggest jump in 8-months. CPI is the measure of the average change over time in the prices paid by consumers for a market basket of consumer goods and services. A December rate hike still seems highly likely.
We kicked off another round of earnings reporting and have seen financial titans JPMorgan (JPM), Bank of America (BAC) & Citigroup (C) come in with better than expected results. In general, we believe that we will continue to see a better than expected earnings season for Q3 that will continue to be fueled by low-interest rates & stock buybacks that help to maintain positive corporate earnings results and expectations going forward. See Walmart (WMT) as a perfect example as it realized a 9.7% upward move on its stock post announcing a $20B buyback.
President Trump’s camp added its regular supply of fear & confidence in the markets as we saw him sign an executive order that is to cut off subsidy payments to health insurance companies that provide Obamacare health plans, brought back into light the possibility that the U.S. will leave the North American Free Trade Agreement & added the possibility of corporate and individual tax cuts.
California wildfires continue to hit northern California at an unprecedented rate. Our good wishes go out to all those in its path and hope that it is controlled soon.