MARKETS TODAY Oct 12 (Vica Partners) – The S&P 500 down 0.33% as of 4.00 p.m. Eastern. The Dow Jones Industrial Average down 28 points, or – 0.10%, to 29,210. The tech based Nasdaq down 0.09%.
Stocks mostly down on Wednesday with all three major indexes in the red, as markets anticipate the Feds next steps. The 10-year Treasury note yield flat at 3.905%. U.S. Dollar Index (DXY) is slightly up at $113.31.Oil prices negative today with Brent crude -2.14% and US West Texas Intermediate crude -2.67%.
Sector performance today: Services +0.95 %, with a solid performance from travel/ tourism/ restaurants and broadcast news/ advertising. Energy +0.55%, driven by oil, gas and coal operations.
September Producer Price Index report, today
The producer price index, a measure of prices that U.S. businesses get for the goods and services they produce, increased 0.4% for the month, compared with the Dow Jones estimate for a 0.2% gain.
Takeaway – on a 12-month basis, PPI rose 8.5%, which was a decrease from the 8.7% in August.
Reports out this Thursday
Our teams are not expecting any surprises and look for on forecast projections reflecting stubborn but in control inflation levels.
- Thursday
- Core CPI Sept. forecast: 0.5% last month: 0.6%
- CPI (year-on-year) Sept. forecast: 8.1% previous: 8.3%
- Core CPI (year-on-year) Sept. forecast: 6.6% previous: 6.3%
- Initial jobless claims forecast: 215,000 last month: 219,000
IMPORTANT TO READ as low interest rates will return
The Federal Reserve will be forced to cut interest rates in 2023 if a deep recession occurs as the cure for inflation is not just raising rates. As we see a significant policy change coming by late Spring of 2023 with Powell reversing direction… just look at 12 month declining lower commodity pricing and new reports on rising retail inventories.
Yearly commodity prices will rise “as there are production shortages” which include: iron, copper and crude oil. Upside will continue!
Solid strategy for these type of market days ….
We suggest investing in companies that have solid balance sheets and offer dividends.
Best to continue to cost average buy value stocks and resist most all tech and growth stocks where companies have negative margins. Our Teams forecast a negative 5-7% valuation correction for speculative stocks. DON’T try to time market lows!
*** Look to Index ETF’s like SPY to outperform stocks and most managed funds
*** Energy is the Top Performing Sector in S&P 500 Year to Date and will regain strength shortly
