{"id":3402,"date":"2023-02-16T12:58:02","date_gmt":"2023-02-16T19:58:02","guid":{"rendered":"https:\/\/madisonpoole.com\/?p=3402"},"modified":"2023-03-08T13:31:41","modified_gmt":"2023-03-08T20:31:41","slug":"monthly-economic-update-february-2023","status":"publish","type":"post","link":"https:\/\/madisonpoole.com\/monthly-economic-update-february-2023\/","title":{"rendered":"Monthly Economic Update – February 2023"},"content":{"rendered":"

Hey Friends! Here is February\u2019s monthly newsletter. All the Best ~ The Madison Poole Crew<\/em><\/strong><\/p>\n

Presented by Madison Poole, February 2023<\/p>\n

In this month\u2019s recap: Investors were in a buying mood thanks to moderating inflation, a better-than-feared earnings season, and healthy economic data.<\/p>\n

U.S. Markets<\/h5>\n

Stocks rallied in January as moderating inflation, a better-than-feared earnings season, and healthy economic data put investors in a buying mood.
\nFor the month, the Dow Jones Industrial Average rose by 2.83 percent, the Standard & Poor\u2019s 500 Index jumped by 6.18 percent, and the Nasdaq Composite vaulted by 10.68 percent.1<\/sup><\/p>\n

Shift in Sentiment<\/h5>\n

The stock market opened the new year the way it ended the previous year, moving lower with high-growth names bearing the brunt of selling. Particularly troublesome to investors was the continued strength of the labor market, which heightened worries that the Fed would hike rates higher for longer to bring inflation to its target rate of 2.0 percent.
\nBut market sentiment took a sharp U-turn after another cooling consumer inflation number reinforced the disinflationary trend of the last six months. Suddenly, investors appeared to adopt a different view of the future\u2013one characterized by continued disinflation, a rate hike cycle nearing its end, and a fading probability of a near-term recession.2<\/sup><\/p>\n

The Power of Earnings<\/h5>\n

Corporate earnings provide some much-needed support for the rally. Investors were looking for insights to gauge the state of the U.S. economy through corporate reports and the guidance that management was offering on forward earnings prospects.
\nAs of January 27th, with 29 percent of the companies comprising the S&P 500 Index reporting, 69 percent reported earnings above Wall Street estimates, less than the five-year average of 77 percent but strong enough to bolster confidence.3<\/sup><\/p>\n

A Winding Road Higher<\/h5>\n

The march toward higher stock prices did not follow a straight line. The month\u2019s trading was choppy, with stretches that saw the resurfacing of recession fears and anxieties over future Fed rate hikes. For instance, stocks retreated midmonth on weak retail sales and manufacturing data that raised concerns that the Fed might have gone too far in raising rates.
\nAs the month ended, stocks wavered ahead of a busy week for earnings and the scheduled Fed meeting. But they regained their footing on the final day of trading to close out a strong month.<\/p>\n

Sector Scorecard<\/h5>\n

Most industry sectors ended higher in January, including Communications Services (+14.77 percent), Consumer Discretionary (+15.13 percent), Energy (+2.81 percent), Financials (+6.81 percent), Industrials (+3.71 percent), Materials (+8.97 percent), Real Estate (+9.91 percent), and Technology (+9.26 percent). Three sectors posted losses: Consumer Staples (-1.09 percent), Health Care (-1.83 percent), and Utilities (-2.00 percent).4<\/sup><\/p>\n

What Investors May Be Talking About in February<\/h5>\n

\u2022\u00a0In the month ahead, investors are expected to dig into the details of the January inflation report scheduled for release on February 14.5<\/sup>
\n\u2022\u00a0Investors cheered when the December update showed that inflation dropped again, confirming a six- month downtrend.
\n\u2022\u00a0While the cost of goods has dropped over that time, the cost of services has stubbornly remained high.
\n\u2022\u00a0In gauging how the Fed is viewing inflation progress, investors may keep an eye on the labor market, a major contributor to service costs. The Fed has expressed that a tight labor market, with its attendant wage gains, places upward pressure on inflation.
\n\u2022\u00a0Consequently, wage trend reports, including the monthly Employment Situation Summary and the Atlanta Fed\u2019s monthly Wage Growth Tracker, along with the services inflation number, may become the real headlines going forward.<\/p>\n[panel style=”default” text_align=”left”]CITATIONS:
\n1. WSJ.com, January 31, 2023
\n2. CNBC.com, January 12, 2023
\n3. Insight.FactSet.com, January 27, 2023 4. SectorSPDR.com, January 31, 2023
\n5. BLS.gov, January 31, 2023<\/small>[\/panel]\n[divider style=”solid” color=”#032b65″ opacity=”1″ width=”1000px” placement=”equal”]\n

Madison Poole | 208-898-7668 | www.madisonpoole.com<\/h4>\n

Know someone who could use information like this?
\nPlease feel free to send us their contact information via phone or email. (Don\u2019t worry \u2013 we\u2019ll request their permission before adding them to our mailing list.)<\/strong><\/p>\n[divider style=”solid” color=”#032b65″ opacity=”1″ width=”1000px” placement=”equal”]\n[panel style=”default” text_align=”left”]Provided content is for overview and informational purposes only and is not intended and should not be relied upon as individualized tax, legal, fiduciary, or investment advice.
\nThis material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note \u2013 investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs, or expenses. Investors cannot invest directly in indices. All economic and performance data is historical and not indicative of future results.
\nThe Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market- weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity universe. The CBOE Volatility Index\u00ae (VIX\u00ae) is a key measure of market expectations of near-term volatility conveyed by S&P 500 stock index option prices. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the \u201cNYSE\u201d) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx\u00ae, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions \u2013 the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. The SSE Composite Index is an index of all stocks (A shares and B shares) that are traded at the Shanghai Stock Exchange. The CAC-40 Index is a narrow-based, modified capitalization-weighted index of 40 companies listed on the Paris Bourse. The FTSEurofirst 300 Index comprises the 300 largest companies ranked by market capitalization in the FTSE Developed Europe Index. The FTSE 100 Index is a share index of the 100 companies listed on the London Stock Exchange with the highest market capitalization. Established in January 1980, the All Ordinaries is the oldest index of shares in Australia. It is made up of the share prices for 500 of the largest companies listed on the Australian Securities Exchange. The S&P\/TSX Composite Index is an index of the stock (equity) prices of the largest companies on the Toronto Stock Exchange (TSX) as measured by market capitalization. The Hang Seng Index is a free float-adjusted market capitalization-weighted stock market index that is the main indicator of the overall market performance in Hong Kong. The FTSE TWSE Taiwan 50 Index is a capitalization-weighted index of stocks comprising 50 companies listed on the Taiwan Stock Exchange developed by Taiwan Stock Exchange in collaboration with FTSE. The MSCI World Index is a free-float weighted equity index that includes developed world markets and does not include emerging markets. The Mexican Stock Exchange, commonly known as Mexican Bolsa, Mexbol, or BMV, is the only stock exchange in Mexico. The U.S. Dollar Index measures the performance of the U.S. dollar against a basket of six currencies. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability, and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting, or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.<\/small>[\/panel]\n","protected":false},"excerpt":{"rendered":"

In this month\u2019s recap: Investors were in a buying mood thanks to moderating inflation, a better-than-feared earnings season, and healthy economic data.<\/p>\n","protected":false},"author":3,"featured_media":3404,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/posts\/3402"}],"collection":[{"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/comments?post=3402"}],"version-history":[{"count":2,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/posts\/3402\/revisions"}],"predecessor-version":[{"id":3417,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/posts\/3402\/revisions\/3417"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/media\/3404"}],"wp:attachment":[{"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/media?parent=3402"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/categories?post=3402"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/madisonpoole.com\/wp-json\/wp\/v2\/tags?post=3402"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}