US Markets Gain on Lower Oil Prices and Interest Rates; Bonds Mixed

Good morning,

• The Dow (+0.9%), NASDAQ (+0.6%), S&P 500 (+1.2%), and EAFE (-0.5%) were mixed for the week.  Similarly, taxable bonds gained 0.4% while tax-free municipal bonds fell 0.3%. 
• The 10-year Treasury yield fell 0.04% to finish the week at 5.24%.
• The ISM Services report showed a drop in sentiment, with the prices paid hitting its highest reading since Jul 2022.  Despite dipping, this continues to show healthy growth, but cost pressures could weigh in at some point.
• The Fed meeting minutes were released and demonstrated that most Fed members agreed that two rate hikes are likely for the year, but not necessarily the 2nd one being at its next meeting in late October.
• Oil prices and inflation continue to be the forefront of news and consumer sentiment, which also tends to capture headlines.  Barring any major news in those two areas, they will likely take a back seat for the next few weeks as corporate earnings season begins this week.
• Corporate Earnings – large banks kick off earnings season this week where expectations are very high, with estimated growth of 29% over last year.  More importantly, economists and investors will be listening closely to their outlook and future profit projections.
• Fun Fact? – The bottom 434 companies of the S&P 500 index equal the same market cap as the top 5 (Nvidia, Apple, Google, Microsoft, and Amazon).  This should serve as an important reminder that the S&P 500 may not be as diverse as many people think, and that this popular index is heavily driven by a small handful of stocks that are all in the same industry (AI technology).

Have a great day and terrific week!

^{Source:  Yahoo Finance}

^{Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.}

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^{The Standard & Poor’s 500 Index (S&P500) is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index. Government bonds and Treasury bills are guaranteed by the US government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.}