Markets Mixed on Fed Meeting Minutes and Nvidia Earnings

Good morning and welcome back from the Memorial Day holiday weekend, as we celebrated the lives of the soldiers who made the ultimate sacrifice to give us the freedom we enjoy today.  Thank you for your service!

The Dow (-2.3%), NASDAQ (+1.4%), and S&P 500 (+0.1%) were mixed last week.  Meanwhile, taxable bonds and tax-free municipal bonds were down 0.3% and 0.9%, respectively.  The 10-year Treasury yield rose 0.05% to finish the week at 4.47%.

Not much data was reported last week, so the markets were mostly driven by the Fed meeting minutes and Nvidia’s earnings report.  The meeting minutes showed that members believed that interest rates would need to stay higher for longer, as inflation readings over the past few months have been disappointing.  While this information wasn’t new per se, it was a fresh reminder to investors that the Fed is committed to keeping interest rates higher to slow down inflation.  Investors continue to hope for interest rate cuts to spur the markets.

Nvidia reported blowout earnings this past quarter ….. again!  Nvidia manufactures the chips needed for artificial intelligence (AI), which demonstrates that there continues to be strong demand for AI, boosting stocks in that category.  Nvidia’s gain of 15% last week had a significant impact on the NASDAQ’s increase, despite the broader markets being down.  On a separate and less optimistic note, Target stated that the consumer is being more cautious about spending as pandemic era savings are dwindling.  Remember that consumer spending represents almost 70% of the US economy.

Have a great day and terrific week!

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