The S&P 500 was down for the second week in a row as it closed Friday at 5,954. In a volatile week, Monday started on a soft note with the S&P 500 down about 0.5%. On Tuesday a weaker-than-expected consumer confidence reading weighed on stocks with a similar loss to Monday. At noon on Wednesday the S&P 500 regained the 6,000 level, but then fell off as investors received feedback about the administrations first cabinet meeting and trade tariff discussions. However, the S&P 500 did eke out a 0.01% gain, ending its four-day losing streak. After the bell Nvida reported earnings and street reaction was muted until Thursdays lunch hour. Nvida then sold off with a daily decline of 8.5%, bringing the rest of the market down with a S&P 500 loss of 1.59%. On Friday Januarys Core Personal Consumer Expenditures (PCE) came in at 0.3%, in line with expectations, and the annual rate slowed to 2.6%. The markets reacted positively and marched upward until noon. Then news of the US/Ukraine oval office meeting hit the wires, and the markets bounced around during the next two hours, hitting session and weekly lows. However, the markets then staged a steep recovery, gaining 1.59% and negating Thursdays loss. From a technical perspective the S&P 500 appears to be somewhat oversold. On Thursday the S&P 500 closed below its Bollinger Band lower level, and bounced back above the level on Friday. Another bullish factor is the Treasury 10 year note. On 14 January it stood at a YTD high of 4.81%, and on Friday it closed at a YTD low of 4.23%. Falling rates are usually bullish for equities as investors search for higher returns. For next week trade tariff talks will dominate the news on Monday and Tuesday, while on Friday well get the payrolls/employment reports followed by a Fed Chair speech in the afternoon. For TSP TIPS we gave a new investment mix recommendation as we closed out February. Coincident with the events of this week, we also saw a shift in fund Composite Scores (CS), a weighted average of ten separate indicators. Last Friday, 21 February, the CSs for F/C/S/I were 95/95/65/95 respectively. This Friday, 28 February, the CSs for F/C/S/I were 95/50/40/90 respectively. As such, we allocated funds into the I fund based on its CS of 90 being almost twice that of the C fund (50). In our Moderate and Conservative models we also reallocated into the F fund as its CS was 95, best of the group, and as interest rates decrease, the price of the F fund increases. On 14 January the F fund price was $19.27, and on Friday it closed at $20.01. Lastly, if youd like more info on Composite Scores, search tsp tips trending investment portfolio strategies on You Tube or go to "https://www.youtube.com/watch?v=0Z-zYupgnVM. In closing, hopefully next week well see a return above the 6,000 level on the S&P 500.
The S&P 500 was down for the second week in a row as it closed Friday at 5,954. In a volatile week, Monday started on a soft note with the S&P 500 down about 0.5%. On Tuesday a weaker-than-expected consumer confidence reading weighed on stocks with a similar loss to Monday. At noon on Wednesday the S&P 500 regained the 6,000 level, but then fell off as investors received feedback about the administrations first cabinet meeting and trade tariff discussions. However, the S&P 500 did eke out a 0.01% gain, ending its four-day losing streak. After the bell Nvida reported earnings and street reaction was muted until Thursdays lunch hour. Nvida then sold off with a daily decline of 8.5%, bringing the rest of the market down with a S&P 500 loss of 1.59%. On Friday Januarys Core Personal Consumer Expenditures (PCE) came in at 0.3%, in line with expectations, and the annual rate slowed to 2.6%. The markets reacted positively and marched upward until noon. Then news of the US/Ukraine oval office meeting hit the wires, and the markets bounced around during the next two hours, hitting session and weekly lows. However, the markets then staged a steep recovery, gaining 1.59% and negating Thursdays loss. From a technical perspective the S&P 500 appears to be somewhat oversold. On Thursday the S&P 500 closed below its Bollinger Band lower level, and bounced back above the level on Friday. Another bullish factor is the Treasury 10 year note. On 14 January it stood at a YTD high of 4.81%, and on Friday it closed at a YTD low of 4.23%. Falling rates are usually bullish for equities as investors search for higher returns. For next week trade tariff talks will dominate the news on Monday and Tuesday, while on Friday well get the payrolls/employment reports followed by a Fed Chair speech in the afternoon. For TSP TIPS we gave a new investment mix recommendation as we closed out February. Coincident with the events of this week, we also saw a shift in fund Composite Scores (CS), a weighted average of ten separate indicators. Last Friday, 21 February, the CSs for F/C/S/I were 95/95/65/95 respectively. This Friday, 28 February, the CSs for F/C/S/I were 95/50/40/90 respectively. As such, we allocated funds into the I fund based on its CS of 90 being almost twice that of the C fund (50). In our Moderate and Conservative models we also reallocated into the F fund as its CS was 95, best of the group, and as interest rates decrease, the price of the F fund increases. On 14 January the F fund price was $19.27, and on Friday it closed at $20.01. Lastly, if youd like more info on Composite Scores, search tsp tips trending investment portfolio strategies on You Tube or go to "https://www.youtube.com/watch?v=0Z-zYupgnVM. In closing, hopefully next week well see a return above the 6,000 level on the S&P 500.