10/24: Weekly Economic Update from PMG Wealth Mgmt.

October 24, 2022

THE WEEK ON WALL STREET

A positive start to a new earnings season and late-week hopes for a near-term easing in Fed rate hikes lifted investors’ spirits and powered stocks to gains for the week.

The Dow Jones Industrial Average jumped 4.89%, while the Standard & Poor’s 500 advanced 4.74%. The Nasdaq Composite index added 5.22% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, gained 1.66%.^1,2,3

EARNINGS, FED SPARK RALLY

The stock market narrative shifted last week from Fed interest rate hikes (a persistent drag on investor sentiment) to corporate earnings, which boosted investor enthusiasm with better-than-expected results. Stocks surged in the first two days of trading on the strength of positive earnings surprises, aided by a modest pullback in bond yields and news that the U.K. was scrapping its tax cut plans.

Mid-week, stocks surrendered some gains on a stronger U.S. dollar and rising bond yields. But on Friday, comments by a Fed official that hinted at a possible relaxation in Fed rate hikes sent stocks soaring to close out a good week.

BETTER THAN EXPECTED

Investors were approaching the new earnings season with a fair amount of trepidation amid an environment of higher interest rates and a slowing economy. The concern has been that poor earnings may drag stock prices lower from current levels.

Early earnings results have provided investors with mostly positive surprises. With 88 companies comprising the S&P 500 index reporting, 75% reported profits above analysts’ expectations, well above the 66% long-term average.⁴

THE WEEK AHEAD: KEY ECONOMIC DATA

Monday: Purchasing Managers’ Index (PMI) Composite.

Tuesday: Consumer Confidence.

Wednesday: New Home Sales.

Thursday: Jobless Claims. Durable Goods Sales. Gross Domestic Product (GDP).

Source: Econoday, October 21, 2022

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

______________________________________

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Tuesday: Microsoft Corporation (MSFT), General Electric Company (GE), Visa, Inc. (V), Alphabet, Inc. (GOOGL), General Motors Company (GM), The CocaCola Company (KO), Archer Daniels Midland Company (ADM), 3M Company (MMM), Texas Instruments, Inc. (TXN), United Parcel Service, Inc. (UPS), KimberlyClark Corporation (KMB).

Wednesday: The Boeing Company (BA), Ford Motor Company (F), Bristol Myers Squibb Company (BMY), ServiceNow, Inc. (NOW), General Dynamics Corporation (GD), Norfolk Southern Corporation (NSC).

Thursday: Apple, Inc. (AAPL), Amazon.com, Inc. (AMZN), Intel Corporation (INTC), Mastercard, Inc. (MA), Caterpillar, Inc. (CAT), Merck & Co., Inc. (MRK), McDonald’s Corporation (MCD), Northrop Grumman Corporation (NOC), Comcast Corporation (CMCSA), Southwest Airlines Company (LUV).

Friday: AbbVie, Inc. (ABBV), Exxon Mobil Corporation (XOM), Chevron Corporations (CVX), ColgatePalmolive Company (CL).

Source: Zacks, October 21, 2022

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 return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice. may reschedule when they report earnings without notice.

Phil Guerrero, CFP®

President

Wealth Advisor

phil@pmgwealth.com

George Maroudas

Wealth Advisor

george@pmgwealth.com

Terry Maziarka

Client Service Manager

terry@pmgwealth.com

847.550.6100

Where is PMG online?

Main site with access to your Account View:

Blog site:

Facebook:

LinkedIn:

Twitter: Just George :)

George on Twitter

Visit our website

WEEKLY QUOTE

"Judge each day not by the harvest you reap but by the seeds you plant."

Robert Louis Stevenson

WEEKLY TIP

Some people open a retirement account only to "set it and forget it," leaving the asset allocation unchanged for years. As you get older, be sure to review your allocation choices in light of your risk tolerance and time horizon.

WEEKLY RIDDLE

They can run side by side for thousands of miles; they are made of steel. While they constantly touch the ground, they seldom meet or touch each other. What are they?

LAST WEEK'S RIDDLE

They are sometimes stomped on, yet they can also be very tasty and sweet. What are they?

ANSWER: Grapes.

Know someone who could use information like this?

Please feel free to send us their contact information via phone or email.

(Don't worry - we'll request their permission before adding them to our mailing list)

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested.

This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such.

All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.

MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

CITATIONS:

1. The Wall Street Journal, October 21, 2022

2. The Wall Street Journal, October 21, 2022

3. The Wall Street Journal, October 21, 2022

4. Refinitiv, October 20, 2022