The Week on Wall Street
Daily headlines about the coronavirus had little impact on stock market averages last week. Earnings and mergers had more influence.
All three Wall Street benchmarks improved. The Nasdaq Composite rose 2.21%, outpacing the S&P 500, up 1.58%, and the Dow Jones Industrial Average, up 1.02%. The MSCI EAFE index, which tracks developed overseas equity markets, added 0.17%.
Jerome Powell Testifies on Capitol Hill
Commenting that the economy is in a “very good place,” Federal Reserve Chairman Jerome Powell told congressional legislators that he did not currently see a significant recession risk.
“There’s nothing about this expansion that is unstable or unsustainable,” Powell remarked during his semi-annual report to the House Financial Services Committee. He did reiterate that the central bank was “carefully” watching the coronavirus outbreak and that it could “very likely” have a residual economic impact on the U.S.
Yearly Inflation Reaches 2.5%
Consumer prices have not advanced to this degree since the 12-month period ending in October 2018. Underneath this January headline inflation number, core inflation (minus food and energy prices, which are often volatile) was up 2.3% year-over-year.
These numbers are from the Consumer Price Index, maintained by the Bureau of Labor Statistics. The Federal Reserve monitors inflation using its core personal consumption expenditures (PCE) index, which remains below the central bank’s 2% yearly inflation target.
Gains in Retail Sales, Sentiment
The Census Bureau said retail sales were up 0.3% in the first month of the year, matching the consensus forecast of analysts polled by MarketWatch. Additionally, the University of Michigan’s preliminary February consumer sentiment index monitoring consumer confidence factors went back above 100 last week (100.9).
The S&P 500 has risen more than 1% since the coronavirus surfaced. During the SARS epidemic of 2003, the MERS outbreak of 2013, and the 2015-16 Zika virus breakout, the index declined.
THE WEEK AHEAD: KEY ECONOMIC DATA
Wednesday: The Federal Reserve releases minutes from its January meeting, and the Census Bureau presents data on January residential construction activity.
Friday: The National Association of Realtors issues its latest existing home sales report.
THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: Medtronic (MDT), Walmart (WMT)
Wednesday: Analog Devices (ADI), NetEase (NTES)
Thursday: Dominos (DPZ), Hormel Foods (HRL), Southern (SO)
Friday: Deere & Co. (DE), Royal Bank of Canada (RY)
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
“Act as if what you do makes a difference. It does.”
– William James
Recipe of the Week
Zippy French Toast
- 1 tsp. cinnamon
- ¼ tsp. nutmeg
- 2 Tbsp. sugar
- 4 Tbsp. butter
- 4 eggs
- ¼ cup whole milk
- ½ tsp vanilla extract
- 8 slices of your favorite bread
- ½ cup warm maple syrup
- 2 cups berries or favorite fruit
- In large bowl, mix spices and sugar.
- Add butter to skillet over medium heat
- Beat eggs with milk, vanilla, spice and sugar mix.
- One at a time, immerse each bread slice to the egg, and then fry each side in skillet.
- Garnish with berries and add syrup.
- Serving suggestion: Jam or preserves make a nice change from syrup and berries.
Recipe adapted from foodnetwork.com
4 Facts About Capital Gains
- A capital gain or loss is the difference between what you originally paid for the asset (your basis) and the amount you get when you sell an asset.
- You must include all capital gains in your income, and you may be subject to the Net Investment Income Tax if your income is above certain amounts. Consult a qualified tax expert for help.
- The IRS allows you to deduct capital losses on the sale of investment property. You cannot deduct losses on the sale of property that you hold for personal use.
- If your total net capital loss is more than the limit you can deduct, you can carry it over to next year’s tax return.
The Myth of Always Hitting Your Regular Distance
Eating To Your Heart’s Content
Upgrading to an Eco-Friendly Fridge
Tip adapted from Green Living Ideas