MP005: Market Perspective with Vector’s Jason Ranallo
Episode description
In this week's Market Perspective, we get into some noteworthy stats coming out of markets and the economy. Here are the highlights:
Stock Market: The S&P 500 recently experienced a 5% swing during the March-April-May period. The U.S. stock market is now back to an all-time high. Part of the reason for the move up, we believe, is due to corporate earnings results which have been stronger than expected. About 77% of companies have reported results above expectations.
Jobs Market: The job market continues to present a "Goldilocks" scenario with historically low unemployment rates and robust job growth. However, the Employment Trends Index hints at a slight slowdown in job growth later this year.
Small Business Sentiment: Optimism among small business owners dipped in March due to inflation concerns but rebounded slightly in April, exceeding expectations.
Inflation and PPI: The Producer Price Index (PPI), which is a measure of inflation from the perspective of producers and manufacturers, rose more than anticipated. This suggests potential future increases in the pipeline for consumer prices, potentially foreshadowing persistent inflationary pressures.
Vector Insights: In our analysis we find market declines of 5% occur relatively frequently, every 51 market days on average. A 10% decline occurs about every year and a half. Market swings will occur which can test the emotions of long-term investors. Rather than losing sleep over natural short-term market volatility we stress the importance of having a plan in place for when markets go up, and down.
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