This Week – Powell and Earnings

The direction thus far for 2022 has been downward, quickly!  Nothing spooks the markets more than uncertainty, regarding how fast interest rates may move higher?  Chairman Powell has provided whiplash in the past, in both directions! The uncertainty pushed the major index down last week with the Dow retreating (4.55%), the S&P 500 (5.67%), the Nasdaq (7.55%) and the Russell 2000 down (8.07%).

Foreign stocks did fare better, dropping (2.08%) and Emerging Market stocks down (1.04%).

The 10 Year US Treasury yield finished last Friday with a yield of 1.75%.  Short-term rates, as indicated by the 2 Year Treasury, closed last week with a yield of .99% (up from .29% from December 31, 2021).

It appears short US Treasuries have priced a fair amount of Fed rates increases, however the 10-year so far, has shown temporary resiliency.  

Powell and Earnings

This Wednesday, Powell gets the opportunity to further explain how he’s going to deal with inflation.  If he acts even more hawkish, further declines could be in the cards.  I believe the Fed has as much uncertainty about what to do, as WE have about it’s actions.

This week, we’ll also hear a large number of corporate earnings reports.  Apple, Microsoft, Tesla, J&J, Amex and Visa are just a handful of important companies to report.

Their reports and commentaries about the next few quarters will be very important.  How much are rising costs impacting their bottom lines?  Do they see supply chains loosening up?

Social Security Webinar

If you were born prior to January 2, 1954, the Social Security strategies available made it fairly easy to decide how to put the greatest amount of dollars in your pocket.

Now, your selection of WHEN to start your Social Security Retirement benefit is more difficult and can have significant impactful for your retirement years.

The originally scheduled webinar for this Tuesday January 25th, has been moved to Tuesday February 8th @ 6pm.  This webinar is being presented in conjunction with Jefferson Hospital (the original date was moved due to a scheduling conflict at Jefferson).

If you or anyone you know has not yet filed for Social Security benefits, feel free to reserve your spot for the webinar on the Jefferson website, by clicking here. 

Growth VS. Value Stocks

So far, we’re seeing a large divergence between growth and value funds.  According to Morningstar, the average Large Growth Fund is down year-to-date (12.25%), and the average Small Growth Fund is down (15.88%).  The average Large Value Fund is down (3.64%), the average Small Value Fund down (6.97%).

Is your portfolio overweight growth?  Are you properly diversified?  Don’t fall asleep and hope your portfolio is properly positioned.  Schedule a complimentary portfolio review that will assist you in making proper decisions for the specifics of your financial situation by clicking here. 

 

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Paul Levin CFP®, ChFC®, RICP®

Retirement Income Certified Professional®