As a former competitive swimmer, I can definitely say I preferred swimming in a calm pool rather than a choppy sea, which parallels investing. Most of us would prefer a relatively calm market to the choppiness that we have seen with the S&P 500 (SPY) over the past couple of weeks. But we deal with the cards that are dealt to us. We continue to see volatility in the markets as last week started the same as the previous week, with three straight days of losses, only to rebound on Thursday. Value investors continue to worry about the Fed increasing rates, while growth investors fear inflation and an increase in bond yields. The key to investing in volatile periods is to stay the course and not panic. So, in today's commentary, I will highlight the market over the past week and what I expect this week. Read on below to find out more….(Please enjoy this updated version of my weekly commentary from the POWR Value newsletter).
Stocks finished lower on Monday, as inflationary concerns remained on investors' minds. The Nasdaq Composite lost 0.4% after the benchmark finished its fourth straight weekly drop in the previous week, its longest losing streak since August 2019.
The market ended lower again on Tuesday as investors weighed solid retail earnings against disappointing housing data. Housing starts declined a worse-than-expected 9.5% in April due to increasing materials costs and supply chain issues.