The Profit Margin: March 14, 2022
Statistic of the Week
Have you been delaying planning or saving for retirement? According to PwC, 1 in 4 Americans have no retirement savings. For those between 55 and 64 years of age, the average retirement account balance is $120,000. Don’t put off planning for the future because current market conditions are bumpy.
Global Perspective
Feeling the full weight of the sanctions put forward by the US, the EU, and countries around the globe, Russia has asked allegedly China for military equipment and economic assistance to offset sanctions. As of the time of this writing, China is denying that they have been asked for aid.
Market Moving Events
Tuesday: Producer Price Index Wednesday: Retail Sales, Import/Export Prices, FOMC Meeting Announcement Thursday: Jobless Claims, Building Permits, Housing Starts, Industrial Production Friday: Existing Home Sales, Leading Economic Indicators
Commentary
It was another bumpy week on Wall Street as markets continued to grapple with the Russian invasion of Ukraine and attempt to discern how Federal Reserve policy will shift with another disturbingly high inflation figure (chart right). All three major US averages sank on the week. The Nasdaq was the week’s worst performer, down -3.53%.1 The S&P 500 dipped -2.88%.2 And the DJIA, held up the best, retreating -1.99%.3 Fixed income also performed poorly on the week. The yield on the 10-year Treasury rose 0.28% to finish Friday at 2.00%.4 Oil spiked mid week when President Biden announced a ban of Russian oil, natural gas, and coal.5 The US is implementing the ban immediately; the UK said it will phase out Russian hydrocarbons by year-end, and the EU said it will reduce Russian natural gas imports by two-thirds.6 Oil [prices ended up reversing to finish the week lower. So too did the Volatility Index (VIX). 7 The VIX came down meaningfully by Friday’s close. This may be signaling investors starting to look for normalcy. In the week ahead, the Federal Reserve has a two-day meeting with a rate announcement and press conference on Wednesday. This is much anticipated and will be closely watched by investors. While markets are expecting a 0.25% rate increase, the hot February CPI reading (chart right) is complicating matters for the central bank. Volatility may be coming down, but it’s not business as usual yet. – Dan McElwee, CFP, ® MBA
Chart of the Week
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Sources
Statistic of the Week:
Barron’s
Global Perspective:
The New York Times
Market Moving Events:
MarketWatch.com
Chart of the Week:
Haver, Clearnomics, Bureau of Labor Statistics
Commentary:1.Bloomberg2.Bloomberg3.Bloomberg4.Bloomberg5.Investor’s Business Daily6.BBC.com7. Baron’s