Market Update
August proved to be a tough month for stocks, with many benchmark indexes ending the month notably lower. Investors tried to decipher mixed economic data throughout the month, attempting to gauge the course of the economy, while trying to determine what the Federal Reserve will do with the interest rates moving forward. Speaking of the Federal Reserve, it did not meet in August, so interest rates remained unchanged. However, Fed Chair Jerome Powell spoke at the Jackson Hole Economic Symposium and reiterated the Fed’s intent to continue its restrictive policy until interest rates fell to 2.0%. Throughout Europe and North America, countries continued to direct economic policy aimed at curtailing consumer price increases. Though inflation certainly cooled, it remained well above targeted levels, prompting central banks to focus policy toward stifling rising prices. Consumers increased their spending on durable goods and nondurable goods and services. The increase in spending included higher prices for energy. Gross domestic product accelerated in the second quarter, but at a slower pace than in the first quarter. Nevertheless, the economy has advanced each quarter since the second quarter of 2022. Corporate profits in the United States rose by 1.6% in the second quarter of 2023, surpassing market expectations that predicted a nearly 6.0% decline. Of the 91.2% of S&P 500 companies that reported earnings results, 78.7% reported earnings above analyst expectations, which surpasses the prior four-quarter average of 73.4% and is well-above the long-term average of 66.4%.
The economic-sensitive Russell 2000 was hit the hardest, falling more than 5.0%. The S&P 500 and the Nasdaq each snapped streaks of five straight months of gains. Overall, despite the August downturn, stocks remained in the black for the year. Bond prices fell in August, with yields increasing over the previous month.
International Markets
While inflationary pressures may have eased somewhat over the last few months, current data shows that several European nations still face inflated prices, indicating that central banks still have more work to do. The Eurozone harmonised index of consumer prices (HICP) came in at 5.3% for the 12 months ended in August, unchanged from the annual rate for July. The United Kingdom's Consumer Price Index dipped lower to 6.8% in July, still well above the 2.0% target rate. Elsewhere, China's economy showed further signs of weakening in August. The Chinese real estate market continued to slump, factories saw exports decline, while consumer spending waned. For August, the STOXX Europe 600 Index increased 0.4%; the United Kingdom's FTSE fell 0.6%; Japan's Nikkei 225 Index rose 1.4%; and China's Shanghai Composite Index dropped 4.9%.
On A Personal Note
In his continuing effort to improve his golf game, Jeff took a couple lessons in the last month. As they say, time will tell. Drew and his wife took in the Billy Joel concert in Columbus. Billy has aged a little bit, but it's still Rock n Roll to Drew! Soccer season officially started for Chris's daughter. They were all very happy to get back into it and are excited for the games. Lisa and David both celebrated birthdays in August. It's amazing every year they keep turning 49! They also moved Shelbi back to BGSU for her senior year. So they are officially once again empty nesters, at least until next April when she graduates. In August Sam took a golf trip to North Myrtle Beach with a few of his friends. They played 5 rounds in 3 days and spent the rest of their time enjoying the pool. His favorite course was Grand Dunes, followed by TPC Myrtle Beach, probably because he scored his best there. Taylor is ready for fall to begin! She already had a pumpkin flavored coffee to celebrate the beginning of September, which her husband thinks she is crazy for. They bought a collar with an airtag tracker for their cat, Hopper, so he can run around outside and explore. It has been fun to watch him become friends with the neighbors.
"Not So Silent Night" Cancer Free Kids Charity Event
On Friday December 1st, MDM will be hosting a “Not So Silent Night” charity event at the Redmoor in Mount Lookout Square from 7-11PM. We are not charging admission for this exciting evening, so please invite your friends and family. The agenda will include a visit from Santa Claus, crafts for kids, a live band, dinner, drinks, and a fabulous silent auction. If you have any specific requests for silent auction items or have items you would like to donate (for example: event tickets, memorabilia, rare bottles of bourbon and wine, or vacation rentals) to benefit this worthy cause, we would love to discuss it with you, and there may even be a tax benefit for you.
If you would like to attend, please email Lisa at lwillhoite@janney.com or give us a call at 513-914-2320.
