Despite a strong rally on Friday, the Dow (-1.2%), NASDAQ (+0.1%) and S&P 500 (-0.8%) ended last week mixed to slightly lower. Meanwhile, taxable bonds were down marginally and tax-free municipal bonds were up slightly. The 10-year Treasury bond yield finished the week roughly unchanged at 3.45%.
The news of the week was centered around the Fed raising interest rates by 0.25% on Wednesday. That was expected by most investors, so their attention was focused on what the Fed Chairman said afterward. There was some indication that the Fed may not be done raising rates, and they certainly were NOT likely to lower rates any time soon. This was not met well by bond investors, as bonds fell after the speech.
As for stocks, corporate earnings reports continued to pour in, but all eyes were focused on the largest company in the world - Apple. In light of Apple being a bellwether company, it also represents the health of BOTH the technology sector, and also that of the consumer. Apple’s earnings exceeded investors’ expectations, vaulting all stocks on Friday, and also strengthening the earnings of the large technology companies this quarter.
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