Weekly Market Update

Dear NVSTly Members,

We hope this newsletter finds you well. Here’s your weekly digest of key happenings in the US stock market and futures trading, tailored just for you.

Market Recap

Stocks rise on dovish signals from Federal Reserve

Stocks moved higher for the week, pushing the S&P 500 Index and the Nasdaq Composite to new records, as investors welcomed news that Federal Reserve policymakers were still anticipating three interest rate cuts later in the year. Communication services led the gains along with technology shares. A late rise helped artificial intelligence chipmaker NVIDIA reach a record high on Friday and lift the company’s market capitalization near USD 2.4 trillion. Reports that Apple might partner with Google parent Alphabet in offering generative artificial intelligence tools also boosted sentiment. Health care and real estate shares lagged. Trading the following week was scheduled to end on Thursday in observance of the Good Friday holiday.

The week’s main driver of sentiment appeared to be the Fed’s policy meeting concluding on Wednesday. As was widely anticipated, policymakers left the federal funds rate unchanged, but our traders noted that investors seemed to take heart from the quarterly release of the Fed’s Summary of Economic Projections, which summarizes the outlook of individual committee members. The so-called dot plot showed that the median expectation for three rate cuts in 2024 remain unchanged, while the median expectations for interest rates in 2025 and 2026 went up by less than 25 basis points (0.25 percentage points), or by less than one cut.

Investors also appeared encouraged by Fed Chair Jerome Powell’s post-meeting press conference, where he indicated that he was not overly concerned about the uptick in inflation data in January and February, chalking it up to seasonal noise. Powell also pushed back against worries over potential signs of cracks in the labor market, such as the unexpected increase in the unemployment rate in February.

Home sales jump unexpectedly in February

The week’s economic data arguably supported hopes that the economy was continuing to expand without reigniting inflation pressures. Most notable may have been February existing home sales, reported Thursday, which surprised most observers by jumping 9.5%. A gauge of current manufacturing in the Mid-Atlantic region fell back a bit from February’s reading but surprised investors by indicating a second consecutive month of expansion. Encouragingly, prices paid by businesses in the region fell back to their lowest level since May 2020.

The news from the Federal Reserve helped drive a decline in longer-term Treasury yields over the week. (Bond prices and yields move in opposite directions.) A softer tone prevailed in the tax-exempt municipal bond market as weakness among high-grade new issues appeared to carry over to the secondary market. Primary issuance ticked upward on Tuesday before becoming nonexistent after the Fed’s meeting. Investment-grade municipal deals generally struggled while high yield municipal deals performed well, partly as a result of the lower issuance volume within the high yield space and healthy demand for high yield municipal bonds from institutional buyers.

Demand remains healthy for corporate paper

Issuance in the investment-grade market was largely oversubscribed during the week, and high yield issues were also met with solid demand. Meanwhile, there was strong demand in the secondary loan market from managers of collateralized loan obligations.

Heat Maps & Performance

Upcoming Economic Events 

Technical Analysis 

Market News

 - The DOJ sues AAPL

- CMG announces a 50:1 stock split

- Biden grants Intel up to 20B

- BOJ hikes rates for the first time in 17 years

Insider Trades

Government Trades

Community Corner

- We've officially started our weekly Market Prep/Q&A sessions! We want you to be as prepared as possible for the upcoming week, and be caught up on the most recent news! Pop in and let us know what you think the market will do! These are hosted every Sunday at 7pm EST.

Remember, successful trading starts with staying informed. We’re committed to keeping you in the loop and enhancing your trading experience. Happy Trading!

- NVSTly Team

Disclaimer: Trading involves risk and is not suitable for everyone. Consult with a financial advisor before making any trading decisions.