Second Week of Stock Retreat – Weekly Update

March 18, 2024 | By Steven DiGregorio

Stocks fell for the second straight week on inflation concerns despite a report on consumer prices that was initially well received by investors.

Stocks Slide

Tuesday was the only bright spot during the week as stock prices rose after the Labor Department report showed the Consumer Price Index rose 3.2% in February compared with a year earlier. It was a bit warmer than economists expected but cooler than investors feared. The news sparked a day-long rally, with the Standard & Poor’s 500 stock index setting its 17th record high of the year.1,2

Following Tuesday, caution lingered as investors parsed the underlying data behind headline consumer inflation numbers. Thursday’s fresh producer price index (PPI) report showed that wholesale prices increased by 0.6% in February, more than the expected 0.3% increase. Additionally, core PPI (excluding food and energy) was hotter than expected. 

Retail sales, also reported on Thursday, were disappointing, rising less than expected and adding to the inflation angst. The news rattled investors and contributed to stocks closing lower for three consecutive days to end the week.3,4

Broadening Leadership

Unlike the prior week when the S&P 500 fell the least, last week it lost slightly more than the Dow but less than the Nasdaq. That performance pattern suggests market leadership may be broadening. Also, the energy, financials, and materials sectors all posted gains last week, showing that other groups may join the tech-led rally.5

This Week: Key Economic Data

Monday: Housing Market Index.
Tuesday: FOMC Meeting Begins. Housing Starts and Permits. 20-Year Treasury Bond Auction.
Wednesday: FOMC Announcement. Fed Chair Press Conference. EIA Petroleum Status Report.
Thursday: Jobless Claims. Existing Home Sales. Fed Balance Sheet.

Source: Investors Business Daily – Econoday economic calendar; March 13, 2024
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.

This Week: Companies Reporting Earnings

Tuesday: GameStop Corp. (GME)
Wednesday: Micron Technology, Inc. (MU), General Mills, Inc. (GIS), Five Below, Inc. (FIVE), Chewy (CHWY)
Thursday: NIKE, Inc. (NKE), FedEx Corporation (FDX), lululemon athletica inc. (LULU), Darden Restaurants, Inc. (DRI)

Source: Zacks, March 13, 2024
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.

Box upload

Source: YCharts.com, March 16, 2024. Weekly performance is measured from Monday, March 11, to Friday, March 15.
ROC 5 = the rate of change in the index for the previous 5 trading days.
TR = total return for the index, which includes any dividends as well as any other cash distributions during the period.
Treasury note yield is expressed in basis points.

Footnotes and Sources

1. The Wall Street Journal, March 15, 2024
2. The Wall Street Journal, March 12, 2024
3. CNBC, March 15, 2024
4. CNBC, March 15, 2024
5. Sector SPDRs, March 15, 2024


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Tags: CPI, DJIA, NASDAQ, PPI, S&P 500, sectors, Tech

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STEVEN M DIGREGORIO is President of Compass Asset Management Group, LLC and an Investment Advisor Representative with Spire Wealth Management, LLC.
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