Three Things to Know & Watch – 9 May, 2022

By Bill Hornbarger, Chief Investment Officer

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Three Things to Watch

  • In terms of economic data, inflation will be front and center this week with CPI released on Wednesday and PPI on Thursday. CPI is expected to ease slightly with the overall reading up 0.2% in April and 8.1% year over year. CPI reached a cyclical peak (to date) and the highest level in over 40 years last month at 8.5%.
  • The University of Michigan Consumer Sentiment Report will be released on Friday (including inflation expectations for one- and five years). Sentiment has been declining and the recent interest rate increase, high gas prices, and equity market volatility will likely weigh on sentiment further.
  • We are nearing the end of Q1 earnings season and to date earnings have been slightly better than expected. Of the 436 S&P 500 constituents that have reported so far, 338 (77.7%) have posted positive earnings surprises. This week will feature reports from Disney, Peloton, Wendy’s, and Occidental Petroleum among others.

Three Things to Know

  • After peaking at $122.5 trillion last November (an all-time high), the value of all global stocks is now $103 trillion after losing $2 trillion last week. (Source: Bloomberg)
  • Last week the NASDAQ followed a 3+% gain with a 4+% loss. This has only happened 13 times since 1980and this rate of change in a single week has only happened twice before (Mar 2020 & Nov 2008). (Source: Seth Golden)
  • The six-month period between May and October 2021 has been the worst performing six-month period for the S&P 500 since 1950. We’ve all heard the saying, “sell in May and go away” that refers to the seasonal tendency of stocks to be weakest between May and October. (Source: The Market Ear)

 

The above information reflects the current opinion of the author. It is based upon sources and data believed to be accurate and reliable. Opinions and forward-looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security mentioned.