What Happened: S&P 500 posts strongest first-quarter performance since 2019

What Does it Mean? Despite the more than $6 Trillion in cash on the sidelines, the stock market has managed to continue to climb a wall of worry notching a double digit return for the quarter. Despite headlines such as increasing debt levels, election uncertainty, war in Ukraine and a myriad of other concerns, equities have scoffed at this uncertainty marching ever higher day after day.

Why Do We Care? Markets are known to be forward-looking indicators, often pricing in what may be coming around the corner, unseen to the naked eye. While we can only speculate what the current stock market may be trying to predict, in our opinion it continues to come down to interest rates. The Federal Open Market Committee (FOMC) has continued to stand by their projections of 3 cuts in 2024, which we think would help the stalling housing market as well as interest rate sensitive companies such as small caps or industrials. It is our opinion that the market is beginning to price in these cuts as well as more in the future. Our goal is to ride this wave until the money on the sidelines is sucked back into the market at higher prices. At that point it will be time to re-evaluate our bullishness.


What HappenedCore PCE – Personal Consumption Expenditures was reported in-line with expectations

What Does it Mean? Personal Consumption Expenditure (PCE) is the preferred method by which the Fed measures inflation. Recently, numbers such as PCE or Consumer Price Index (CPI) have been reported hotter than expected insinuating inflation may be rearing its ugly head once again. Friday morning’s PCE report, however, came in, in-line at .3%, giving us further evidence that inflation may not be headed back up, but rather continuing its downward trend.

Why Do We Care? While the markets are closed for Good Friday, we suspect this would have given further life to equities, specifically the areas most interest rate sensitive. The more evidence we receive regarding the downward trend for inflation the more confident we will feel in the Fed’s future rate cuts. These two things combined have been a positive for stocks, which we believe is what may keep the bulls running.

Make no mistake, however, we are long overdue for a correction. Two weeks ago, it looked as if this would be starting but was postponed after fresh bullish news from Alphabet, formerly Google, which served to spark a new market advance. At some point the selling will stick and the pullback will create a new opportunity for those on the sidelines to re-enter.

Due to continued conflict with China, many companies have been working hard to readjust their manufacturing. This week Quint sat down with CNBC to discuss this and look at a few companies doing just that.


Until next time

~ Quint



Joule Financial, LLC is registered as an investment adviser with the SEC. The firm only transacts business in states where it is properly registered, or is excluded or exempted from registration requirements. Registration as an investment adviser does not constitute an endorsement of the firm by securities regulators nor does it indicate that the adviser has attained a particular level of skill or ability. A copy of Joule’s current written disclosure brochure filed with the SEC which discusses among other things, Joule’s business practices, services and fees, is available through the SEC’s website at: www.adviserinfo.sec.gov

This does not constitute an offer or solicitation. This information should not be considered investment advice. Opinions expressed reflect the judgment of the author and are current opinions as of the date appearing in this material only. While every effort has been made to verify the information contained herein, we make no representations as to its accuracy and it should not be regarded as a complete analysis of the subjects discussed. Past performance does not predict future results. Content should not be construed as legal or tax advice. Always consult an attorney or tax professional regarding your specific legal or tax situation. All investing involves risk, including the loss of some or all of your investment.

Certain information contained herein constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” or “believe,” or the negatives thereof or other variations thereon or comparable terminology. Due to various risks and uncertainties, actual events, results or actual performance may differ materially from those reflected or contemplated in such forward-looking statements. Nothing contained herein may be relied upon as a guarantee, promise, assurance or a representation as to the future.

Hyperlinks in this letter are provided as a convenience, and we disclaim any responsibility for information, services or products found on websites linked hereto.