Investment Commentary – June 14, 2023
Year to Date Market Indices as of June 14, 2023

• Dow 34,126 (3.0%)
• S&P 4,387 (14.26%)
• NASDAQ 13,650 (30.03%)
• OIL $69.28 (-13.86%)
• Barclay Bond Aggregate (1.15%)
• Gold $1,971 (7.73%)

Stocks rise after inflation report, S&P 500 and Nasdaq hit fresh 13-month highs:

Stocks rose Tuesday after new inflation data showed price pressures slowed again in May, adding to investor optimism that the Federal
Reserve could skip a rate hike when it next decides on policy this week.

The Dow Jones Industrial Average traded 145.79 points higher, or 0.43%, to close at 34,212.12. The S&P 500 added 0.69% to close at 4,369.01, and the Nasdaq Composite advanced 0.83% to 13,573.32. The S&P 500 and the Nasdaq notched fresh 13-month highs during Tuesday’s session. Both indexes each reached their highest closing
levels since April 2022 on Monday. Currently, the broad-market index is up about 25% from its October low, surpassing the simplistic
definition of a bull market.

May’s consumer price index increased 4% year over year, marking the slowest annual rate since March 2021. Following the report, traders increased their bets that the Fed will keep rates unchanged on Wednesday after hiking at 10 consecutive meetings. The latest odds gave a roughly 91% chance the central bank would keep rates at the current target rate of 5% to 5.25%, according to CME Group’s FedWatch tool.

′′[The Fed] will buy themselves the maximum amount of optionality by signaling at least one further hike by the end of 2023, aligned with market expectations, and will guide towards a ‘skip’ instead of an extended pause to sit and observe the effects of raising rates 5% since the beginning of the hiking cycle,” said Gargi Chaudhuri, head of iShares investment strategy, Americas, at BlackRock.

Tech shares led the way as easing inflation and rates boosted optimism for the sector. Oracle shares jumped 0.2% a day after the software vendor topped Wall Street’s estimates for the fiscal fourth quarter. Shares of streaming giant Netflix climbed 2.8%.

• The consumer price index rose at a 4% annual pace in May, the lowest reading in over two years, the U.S. Bureau of Labor Statistics said in its latest inflation report.

• So-called “core CPI,” which strips out volatile energy and food prices, has remained stubbornly high, however. That’s a concern for economists.

• Categories such as shelter, motor vehicle insurance, recreation, household furnishings and operations, and new vehicles are among those with notable annual increases, the bureau said.

• Some categories, such as airline fares, car and truck rentals, citrus fruits, fresh whole milk, and used cars and trucks, deflated
over the past year.

 

The views presented are not intended to be relied on as a forecast, research or investment advice and are the opinions of the sources cited and are subject to change based on subsequent developments. They are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investments.

https://www.marketwatch.com/ (Market Indices)
https://www.jhinvestments.com/weekly-market-recap (Around the Web & Upcoming Events)
https://finviz.com/groups.ashx (YTD Performance Chart)
https://www.jhinvestments.com/weekly-market-recap#market-moving-news
https://www.cnbc.com/2023/06/12/stock-market-today-live-updates.html
https://www.cnbc.com/2023/06/13/heres-the-inflation-breakdown-for-may-2023-in-one-chart.html