• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
Marin Wealth Advisors

Marin Wealth Advisors, LLC.

Registered investment Advisor

  • Investment Advice
    • Help with Your Investments
    • Investment Standards
    • ESG Investing
    • ESG Portfolio Management
  • Financial Planning
    • Stock Compensation Advisors
    • 529 College Savings Plan
    • Estate Planning Advisors
    • Personal Financial Coach
  • Retirement Planning
    • Retirement Financial Advisor
    • Early Retirement
    • Employer 401K Plans
    • IRA Rollover Accounts
    • Business Retirement Plans
  • Online Wealth Advisor
  • About
  • Blog
  • Locations
  • Contact
  • Client Portal
  • Investment Advice
    • Help with Your Investments
    • Investment Standards
    • ESG Investing
    • ESG Portfolio Management
  • Financial Planning
    • Stock Compensation Advisors
    • 529 College Savings Plan
    • Estate Planning Advisors
    • Personal Financial Coach
  • Retirement Planning
    • Retirement Financial Advisor
    • Early Retirement
    • Employer 401K Plans
    • IRA Rollover Accounts
    • Business Retirement Plans
  • Online Wealth Advisor
  • About
  • Blog
  • Locations
  • Contact
  • Client Portal

Fed Continues to Crash the Party – December 16 Market Recap

December 16, 2022

Fed Continues to Crash the Party – December 16 Market Recap

Indices 

  • Dow 32,920, -556 or -1.7%. 
  • Nasdaq 10,705, -299 or -2.7%. 
  • S&P 3,852, -219 or –5.4%. 
  • USD10Y 3.482%, -8.5bp or -2.4%. 
  • WTI Crude $74.50/bbl, +$2.91 or +4.1%. 

Fed Continues to Crash the Party 

Markets were going along their merry way early this week. November Fed inflation expectations were lower than October’s numbers and more importantly the indices were celebrating a great Consumer Price Index print that showed both month over month and year over year inflation still increasing but at a slower pace than expected. Then of course, the Fed showed up on Wednesday, raised rates ½ percentage point as expected, and proceeded to crush the rally during a very hawkish press conference. Fed Chair Powell, in his opening statement and in response to questions from the press, said that despite multiple indications that the economy is slowing, that the Fed still anticipates raising rates for some time and does not anticipate cutting rates in 2023. Markets quickly turned negative and traded down significantly for the last two trading days of the week. 

“Don’t Fight the Fed.” It’s a saying that has been repeated time and time again on trading desks and investment circles since the central bank’s inception. However, one must wonder when the bank may pause rate hikes given that Powell cited tepid GDP growth, significantly weakened housing markets, slower consumer spending and weakened business fixed investment. At what point does the bank risk overshooting, over tightening and positioning the economy into a recession while eliminating 1.6 million jobs (due to rate increases slowing the economy and creating layoffs as businesses downsize)? 

Market Recap will return on January 6th. Happy Holidays and Happy New Year! 

Next Week 

It is a very light week for economic data next week. The lone exception is on Friday, when the Fed’s preferred measure of inflation, the Personal Consumption Expenditure (PCE), is released. 

Economic Calendar 

  • Monday – N/A 
  • Tuesday – N/A 
  • Wednesday – December Consumer Confidence, November Existing Home Sales. 
  • Thursday – Initial Jobless Claims, Q3 Real GDP. 
  • Friday – November PCE. 

 If you know of any friends or family members who could benefit from our services and these types of communiques during these unique times, we are accepting new clients and offer a complimentary one-hour review. 

December 16 Daily Trading Recap… 

Monday – Dow +528 to 34,005 Nasdaq +139 to 11,143, S&P +56 to 3,990, USD10Y +4.4bp to 3.611% 

  • All eleven S&P sectors traded higher today, led by Energy, Utilities, and Technology. 
  • November NY Fed 1-year and 5-year inflation expectations were both lower than last month. The 1-year expectation was 5.2% vs last month’s 5.9% and the 5-year expectation was 2.3% vs 2.4% last month. 
  • Oracle (ORCL) beat both top and bottom-line expectations and traded up 2% post-close. 

Tuesday – Dow +103 to 34,108, Nasdaq +113 to 11,256, S&P +29 to 4,019, USD10Y -11.0bp to 3.501%. 

  • Ten of eleven S&P sectors traded higher today, led by Real Estate, Energy, and Communication Services. 
  • Markets rallied for a second day on better-than-expected inflation news. 
  • November month over month (MoM) CPI was +0.10% vs expectations of +0.3% and last month’s +0.4% print. As a result, the year-over-year (YoY) CPI fell to +7.1% vs +7.3% expected and last month’s +7.7%. 
  • November Core CPI (MoM) was also better than expected at +0.2% vs +0.3% and October’s +0.3% print. YoY Core CPI fell to +6.0% vs +6.1% expected and last month’s +6.3%. 
  • The probability of a 50bp hike at the December Fed meeting increased today to 83% vs 73.5% yesterday. 

Wednesday – Dow -142 to 33,966, Nasdaq -85 to 11,170, S&P -24 to 3,995 USD10Y +0.2bp to 3.503%. 

  • Ten of eleven S&P sectors traded down today, led lower by Financials, Materials, and Real Estate. 
  • The Fed raised interest rates by 0.50% as expected. In his press conference however, Fed Chair Powell struck an aggressive tone saying there was more work to do to fight inflation and as a result markets fell across the board. 

Thursday – Dow –764 to 33,202, Nasdaq -360 to 10,810 S&P -99 to 3,895, USD10Y -5.3bp to 3.45% 

  • All eleven S&P sectors traded down today, led lower by Communication Services, Technology, and Materials. 
  • Jobless claims fell to 211,000 claims vs 230,000 expected and last week’s slightly revised higher print of 231,000 (originally 230,000 claims). Continuing claims rose were relatively unchanged at 1.671 million. 
  • November Retail Sales were worse than expected at –0.6% vs –0.3% and last month’s +1.3%. 
  • December Empire State Manufacturing and Philadelphia Fed Manufacuring Index were both worse than expected. The former was –11.2 vs –0.5 expected and last month’s 4.5 print. Philly Fed came in at –13.8 vs –12.0 expected and –19 last month. 
  • Stocks fell precipitously as yesterday’s Fed announcement sunk in and weak retail sales and manufacturing data stoked recession fears. 

Friday – Dow -281 to 32,920, Nasdaq -105 to 10,705, S&P -43 to 3,852, USD10Y +3.2bp to 3.482%.  

  • All eleven S&P sectors traded down today, led lower by Real Estate, Consumer Discretionary, and Utilities. 
  • Both December S&P U.S. Manufacturing and Services PMI (flash) were lower than expected. 46.2 vs 47.7 for the former and 44.4 vs 46.5 for the latter. 

If you know of any friends or family members who could benefit from our services and these types of communiques during these unique times, we are accepting new clients and offer a complimentary one-hour review. 

Disclaimer: This is not a recommendation to buy or sell any of the securities listed above. I personally, or a family member whose account I control, have positions in the following securities/assets…Bitcoin, Cardano, Chainlink, Ethereum, ETHE, GBTC, and TSLA. 

Category iconEducation Tag iconfederal reserve,  inflation,  market recap

Primary Sidebar

Recent Posts

  • Everyone Expects 25bp, but What’s Next (January 27 Market Recap)
  • Bad News is Now Just Bad News; Inflation at Fed’s 2% Target (January 20 Market Recap).
  • CPI Good, Inflation Expectations Decreasing, Will the Fed Care (January 13 Market Recap) ? 
  • No Santa Rally but Average Hourly Earnings Save the Day (January 6 Market Recap)
  • Fed Continues to Crash the Party – December 16 Market Recap

Categories

  • Asset Allocation (1)
  • Education (94)
  • ESG Investing (1)
  • Estate Planning (4)
  • Financial Planning (10)
  • Investment Management (43)
  • Investments (16)
  • Retirement Planning (12)
  • Stock Compensation (2)
  • Uncategorized (19)

Working With Marin Wealth Advisors

Fee-only Investment Management
Financial Planning at an hourly rate
No commission, no conflict of interest

Request a complimentary one-hour financial review


    Footer

    Marin Wealth Advisors LLC

    899 Northgate Drive, Suite 300
    San Rafael, CA 94903
    415-458-5880

    50 California St. Suite 1500
    San Francisco, CA 94111
    415-472-5885

    1901 Harrison Street, Suite 1100
    Oakland, CA 94612
    510-217-8100

    2121 California Blvd, Suite 290
    Walnut Creek CA 94596
    925-374-4899

    info@marinwealthadvisors.com

    All Content Copyright © 2023 Marin Wealth Advisors, Registered Investment Advisor, Marin County, CA

    Disclaimer:
    The MWA website and blogs are limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links.
    All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

    No information contained on this website or blog constitutes tax, legal, insurance or investment advice.

    Best Financial Advisors in San Francisco
    Financial Advisors in Marin County

    Stay Connected: