Pressured by weakness in Mega Cap Tech stocks like Microsoft, Alphabet and Apple, the S&P 500 closed down this week at 4620. On Tuesday the producer price index report showed a year-over-year increase of 9.6%, the fastest pace on record. With this data point in their pockets when the Fed met the following day, it was announced that they will start making aggressive policy moves to thwart rising inflation. First, the central bank said it will accelerate the reduction of its monthly bond purchases and second, Fed officials see as many as three interest rate hikes in 2022, with another two in 2023 and then again 2024. That said, the markets rebounded on that news and Wednesday was the best day of the week with the S&P 500 closing above 4700 again and closing just three points shy of a new record high. However, Wednesdays 1.63% gain was the one bright light this week as the first two and last two days were down. For TSP TIPS, the C fund continues to be the one bright light as its performance ranking is still positive, while the S and I funds have negative performance rankings. Additionally, the C funds price is still above its 50 day moving average, which is above its 200 day moving average. As such, we are recommending no changes to our current allocation. Also, with the markets closed next Friday, Santa better get going if theres going to be a Santa Claus rally. Lastly, we wish everyone a Merry Christmas and Happy Holidays!!
Pressured by weakness in Mega Cap Tech stocks like Microsoft, Alphabet and Apple, the S&P 500 closed down this week at 4620. On Tuesday the producer price index report showed a year-over-year increase of 9.6%, the fastest pace on record. With this data point in their pockets when the Fed met the following day, it was announced that they will start making aggressive policy moves to thwart rising inflation. First, the central bank said it will accelerate the reduction of its monthly bond purchases and second, Fed officials see as many as three interest rate hikes in 2022, with another two in 2023 and then again 2024. That said, the markets rebounded on that news and Wednesday was the best day of the week with the S&P 500 closing above 4700 again and closing just three points shy of a new record high. However, Wednesdays 1.63% gain was the one bright light this week as the first two and last two days were down. For TSP TIPS, the C fund continues to be the one bright light as its performance ranking is still positive, while the S and I funds have negative performance rankings. Additionally, the C funds price is still above its 50 day moving average, which is above its 200 day moving average. As such, we are recommending no changes to our current allocation. Also, with the markets closed next Friday, Santa better get going if theres going to be a Santa Claus rally. Lastly, we wish everyone a Merry Christmas and Happy Holidays!!