Marching on – the madness continues

Stocks have been able to continue to climb even as Treasury yields have also risen. The S&P 500 posted its biggest first-quarter gain since 2019 and has set more than a dozen highs without a significant pullback so far this year. Meanwhile, the yield on the 10-year Treasury was last around 4.2%, up from 3.86% at the end of last year.
The “Magnificent Seven” tech and growth stocks that largely drove the stock market higher last year have continued to propel the markets higher this year, although it may now just be the “Fab 5” or the “Fantastic 4” as a couple of the companies have lagged this year.
The market rally is broadening out past just the tech sector with strong performance by Energy, Materials, and Utilities in March. Also noteworthy regarding asset classes is that Value outperformed Growth for the month.
The US inflation rate posted a slight increase in February to 3.15%. Inflation has now hovered in the 3-4 percent range for the last eight months.
February’s unemployment rate rose to 3.9% while the labor force participation rate stayed at 62.5% for the third consecutive month.
Equities continued their rally from February with modest gains in March. The S&P 500 rose 3.2% in March, the Dow Jones Industrial Average advanced 2.2%, and the NASDAQ tacked on 1.9%. Small-caps bested large-caps in March, as the Russell 2000 rose 3.6% while the Russell 1000 added 3.2%. In terms of style boxes, however, large-cap value stocks (IWD) had the best month with a 5% gain.

The only negative sector in March was Consumer Discretionary, which was in the red by just 0.07%, and this comes after leading all sectors in February with a 7.9% gain. The leader was Energy (+10.5%), followed by Utilities and Materials, with gains of 6.6% and 6.5%, respectively.

The Economic Data Rundown

Employment

February’s unemployment rate rose to 3.9% while the labor force participation rate stayed at 62.5% for the third consecutive month. According to nonfarm payroll data, 275,000 new jobs were added in February, beating the expected figure of 200,000.

Consumers and Inflation

The US inflation rate posted a slight increase in February to 3.15%. Inflation has now hovered in the 3-4 percent range for the last eight months. Core Inflation logged its 11th consecutive monthly decline, falling to 3.75% in February. The monthly US Consumer Price Index rose 0.44% in February, and US Personal Spending’s Month-over-Month (MoM) increase of 0.76% was the highest since January 2023. The Federal Reserve held its key Fed Funds Rate at 5.50% at its March 20th, 2024 meeting, marking the fifth consecutive meeting in which the Fed left rates unchanged

Production and Sales

The US ISM Manufacturing PMI surged 2.5 points to 50.3, reaching expansion territory for the first time since October 2022. February US Retail and Food Services Sales rebounded by 0.6% MoM, while the Year-over-Year (YoY) US Producer Price Index increased by 1.6%.

Housing

US New Single-Family Home Sales slipped 0.3% MoM in February, but US Existing Home Sales jumped 9.5% MoM. The demand pushed the Median Sales Price of Existing Homes up 1.6% in February to $384,500, putting an end to a seven-month streak of declines. Mortgage rates decreased slightly in February; the 15-year Mortgage Rate fell to 6.11% as of March 28th, and the 30-year came down to 6.79%.

Commodities

The price of Gold jumped 8.1% in March on news of possible June rate cuts, even as the dollar and treasury yields climbed. Gold ended the month at $2,214.40 per ounce, and the SPDR Gold Shares ETF (GLD) set a new all-time high as well. Crude oil prices continued steadily higher in March following a trough in December 2023; the price of WTI advanced 4% to $82.41 per barrel while Brent rose 1.9% to $86.18, both as of March 25th. Higher oil prices also pushed the average price of gas 27 cents higher to $3.64 per gallon as of the final week of the month, further forming a “U-shaped recovery”.

As always, don’t hesitate to contact us if you have any questions about what impact, if any, this may have on your financial plan.

For more great insights, highlights, and financial education,

follow MDL Wealth Management on:

This newsletter was prepared by YCharts.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk.

The economic forecasts set forth in this material may not develop as predicted, and there can be no guarantee that strategies promoted will be successful.

The Dow Jones Industrial Average is comprised of 30 stocks that are major factors in their industries and widely held by individuals and institutional investors.

The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index.

The Bloomberg U.S. Aggregate Bond Index is an index of the U.S. investment-grade fixed-rate bond market, including both government and corporate bonds.

The Standard & Poor’s 500 Index (S&P500) is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. All indices are unmanaged and may not be invested into directly. The fast price swings in commodities may result in significant volatility in an investor’s holdings. Commodities include increased risks, such as political, economic, and currency instability, and may not be suitable for all investors. Precious metal investing may involve greater fluctuation and potential for losses.

Monthly Market Recap – March 2024

Marching on – the madness continues

The Economic Data Rundown