Market Summary – September 18, 2023

Last Week’s Summary

  • S&P 500 Index fell 0.12%
  • International Equities rose 1.71%
  • Emerging Markets rose 1.26%
  • U.S. 10-Year Treasury Yield rose to 4.33%
  • CPI rose to 3.7%; Core fell to 4.3%
  • Initial Jobless Claims rose to 220k
  • PPI rose to 1.6%; Core fell to 2.2%
  • U. of Mich. Sentiment fell to 67.7

What to Watch for This Week

  • M, 9/18/23 NY Fed Services Business Activity
  • T, 9/19/23 Housing Starts, Building Permits
  • W, 9/20/23 FOMC Rate Decision, MBA Mortgage Applications
  • Th, 9/21/23 Initial Jobless Claims, Philadelphia Fed Business Outlook, Leading Index
  • F, 9/22/23 S&P Global U.S. Manufacturing PMI

Weekly Market Recap

The S&P 500 Index fell 0.12%, notching its second weekly decline. Traders grappled with the repercussions of a labor strike affecting Detroit automakers, notably Ford Motor Co. and General Motors Co., which led to volatile trading.

ARM Holdings, one of the year’s most eagerly awaited IPOs, started trading on Thursday, surging by an impressive 25%. This surge was fueled by the prevailing enthusiasm within the semiconductor sector. Meanwhile, traders diligently sifted through economic data in anticipation of the Federal Reserve’s upcoming decision next week. The prevailing consensus suggests that the Federal Reserve will maintain current interest rate levels.

However, the resilient U.S. economy is expected to prompt the Federal Reserve to pencil in one more interest-rate hike later this year, with expectations of a more prolonged period at peak levels than previously anticipated for next year.

The VIX, widely recognized as the market’s “fear-index,” saw an uptick after reaching its lowest levels since before the 2020 pandemic. Notably, it has not surpassed the 15 mark since late August, which had previously served as a support level since the onset of the pandemic.

U.S. inflation expectations dipped to their lowest point in over two years, as consumers grew increasingly optimistic about the economic outlook. Surprisingly, a measure of New York state factory activity expanded, driven by new orders, even though production at factories saw minimal growth in August due to a decline in motor vehicle output.

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