Mid-Week Market Minute 1.4.23

Market Updates

Stocks Modestly Lower; International Markets See Boost

U.S. stocks hobbled into the New Year as the same inflation and recessionary concerns that burdened the markets last year remain at the forefront. Stocks were modestly lower to kick off the holiday-shortened trading week. Apple (AAPL) saw its market capitalization fall below $2 trillion amid ongoing challenges in China. On the other hand, encouraging inflation data overseas helped boost international markets. In France, consumer prices declined by more than expected while Germany saw a larger than expected decline in import prices.

In other news, a final update from S&P showed U.S. Manufacturing Purchasing Managers’ Index (PMI) remained unchanged at 46.2, while construction spending unexpectedly climbed 0.2% month-over-month in November, much stronger than October’s decline of 0.2%. Investors also will digest the latest job openings, or JOLTS, report on Wednesday ahead of Friday’s big jobs report.Expectations are for the economy to add 200,000 jobs with the unemployment rate expected to hold steady at 3.7%.The Fed will be paying close attention to the year-over-year increase in average hourly earnings, which is expected to fall from 5.1% to 5.0%. Wage inflation is an important metric to the Fed, so any deviation from consensus could spur elevated volatility. In addition to the jobs data, investors are awaiting the minutes from the latest Federal Reserve meeting on Wednesday. Markets currently are pricing in about a 70% chance of a 0.25% (25 basis point) rate hike at the next Fed meeting, which concludes Feb. 1.

Source: GSAM, CNBC, JPMorgan

This communication is for informational purposes only. It is not intended as investment advice or an offer or solicitation for the purchase or sale of any financial instrument.

Indices are unmanaged, represent past performance, do not incur fees or expenses, and cannot be invested into directly. Past performance is no guarantee of future results.