efficentupup wrote a post · Apr 24, 2023 06:35

S&P 500 Weekly Summary

S&P 500 largely unchanged for the week ahead of Q1 earnings season deluge

The $S&P 500 Index (.SPX.US)$ on Friday slipped marginally by 0.10% for the week to close at 4,133.52 points, with the benchmark index ending near the flatline in each of its five sessions. Its accompanying SPDR S&P 500 Trust ETF ( $SPDR S&P 500 ETF (SPY.US)$ ) also fell slightly by 0.07% for the week.

Earnings season was a major focus this week, with companies such as $Johnson & Johnson (JNJ.US)$ , $Bank of America (BAC.US)$ , $Goldman Sachs (GS.US)$ , $AT&T (T.US)$ , $American Express (AXP.US)$ , and $Procter & Gamble (PG.US)$ releasing quarterly reports. The reports of Netflix and $Tesla (TSLA.US)$ were highly anticipated, with $Netflix (NFLX.US)$ 's revenue slightly below expectations but with good profit and user growth, while Tesla emphasized the impact of increased costs and price reductions on profit.

Overall, the earnings announcements so far have not spurred a lot of enthusiasm in traders. Next week the season picks up steam significantly, with heavyweight companies such as Alphabet ( $Alphabet-C (GOOG.US)$ ) ( $Alphabet-A (GOOGL.US)$ ), Microsoft ( $Microsoft (MSFT.US)$ ), Amazon ( $Amazon (AMZN.US)$ ), Meta ( $Meta Platforms (META.US)$ ), Boeing ( $Boeing (BA.US)$ ) and Coca-Cola ( $Coca-Cola (KO.US)$ ) on tap.

Outside of earnings, sentiment during the week was also affected after economic data continued to show a slowdown in various areas of the economy. This data included a more-than-expected rise in the number of Americans filing for jobless claims, an eight straight negative reading in the Philly Fed business outlook, a higher-than-anticipated fall in existing home sales and a decline in U.S. leading indicators.

People are concerned that the Federal Reserve's rapid increase of interest rates will cause a sudden economic slowdown and recession in the U.S. The Fed is expected to raise rates by 25 basis points in both May and June based on data from CME FedWatch.

See below a breakdown of the weekly performance of the sectors as well as their accompanying SPDR Select Sector ETFs from April 14 close to April 21 close:

1: Consumer Staples +1.68%, and the Consumer Staples Select Sector SPDR ETF ( $Consumer Staples Select Sector SPDR Fund (XLP.US)$ ) +1.85%.
2: Real Estate +1.59%, and the Real Estate Select Sector SPDR ETF ( $Real Estate Select Sector Spdr Fund (The) (XLRE.US)$ ) +1.58%.
3: Utilities +1.09%, and the Utilities Select Sector SPDR ETF ( $Utilities Select Sector SPDR Fund (XLU.US)$ ) +1.06%.
4: Financials +0.98%, and the Financial Select Sector SPDR ETF ( $Financial Select Sector SPDR Fund (XLF.US)$ ) +1.00%.
5: Industrials +0.75%, and the Industrial Select Sector SPDR ETF ( $Industrial Select Sector SPDR Fund (XLI.US)$ ) +0.78%.
6: Consumer Discretionary +0.53%, and the Consumer Discretionary Select Sector SPDR ETF ( $Consumer Discretionary Select Sector SPDR Fund (XLY.US)$ ) +0.32%.
7: Health Care -0.24%, and the Health Care Select Sector SPDR ETF ( $The Health Care Select Sector SPDR® Fund (XLV.US)$ ) -0.20%.
8: Materials -0.31%, and the Materials Select Sector SPDR ETF ( $Materials Select Sector SPDR ETF (XLB.US)$ ) -0.28%.
9: Information Technology -0.46%, and the Technology Select Sector SPDR ETF ( $The Technology Select Sector SPDR® Fund (XLK.US)$ ) -0.60%.
10: Energy -2.54%, and the Energy Select Sector SPDR ETF ( $Energy Select Sector SPDR Fund (XLE.US)$ ) -2.58%.
11: Communication Services -3.05%, and the Communication Services Select Sector SPDR Fund ( $The Communication Services Select Sector SPDR® Fund (XLC.US)$ ) -2.60%.

Comments:Things have been pretty quiet lately. Unemployment claims are up but not to a concerning level. Inflation rates are lower than before but still a little higher than desired. Data suggests that there has been a dip in economic growth, but corporate revenues from the last quarter look decent. There haven't been any surprises with distributions and the usual annual increases are still happening. Central banks are slowly increasing interest rates. Despite the conflict in Ukraine, markets have adjusted. It looks like the next US Presidential election will be a repeat of the last one, with the country still split evenly between the two major parties. The biggest issue right now is increasing the debt limit. As investors, we'll have to keep waiting and see what happens.

OR? A very consequential next week for risk and market sentiment. Have a great Monday fam!

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efficentupup

True and timely

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