WEEKLY MARKET RECAP – JANUARY 12, 2024
The major U.S. stock indexes rebounded, recovering from the declines observed the previous week that interrupted a streak of nine consecutive positive weeks at the end of 2023. By Friday’s close, the S&P 500 was just 0.3% below the record closing high it achieved on January 3, 2022.
Two monthly price reports continued the recent pattern of uneven progress in curbing inflationary pressures. In December, the Consumer Price Index showed a month-to-month increase of 0.3%, slightly surpassing the expectations of most economists and marking the third consecutive monthly rise. On the other hand, the Producer Price Index, which monitors prices charged by factories to wholesalers, slipped by 0.1%.
Earnings season for U.S. banks commenced, with three major institutions reporting a decline in fourth-quarter net income compared to the same quarter in the previous year. Initial reports on Friday led analysts to project a slight decline in earnings for S&P 500 companies, averaging 0.1%, according to FactSet. If realized, this would mark the fourth quarter out of the past five with a negative earnings growth rate.
Mixed reports on inflation trends and changing market perceptions of the interest-rate outlook contributed to a volatile week in the bond market. After concluding the prior week at 4.04%, the yield of the 10-year U.S. Treasury bond reached as high as 4.07% on Thursday before retracing to 3.95% at Friday’s close.
A Japanese stock index experienced a significant surge of over 6%, marking its most substantial weekly gain since March 2020. This surge propelled the index to its highest level since February 1990, a period associated with the bursting of an asset price bubble in Japan, leading to an extended economic downturn and a decline in the nation’s stock market.
Increased geopolitical tensions in the Middle East contributed to a modest rally in oil prices on Friday. U.S. crude was trading around $73 per barrel, an increase from a recent low of around $68 on December 12 but still below its mid-October level of around $87.
A report set to be released on Wednesday will offer an update on U.S. retail sales activity during the holiday shopping season. The December sales data follows a November report that recorded a stronger-than-expected 0.3% increase compared to the previous month’s 0.2% decline.
Major U.S. Economic Reports
| Report | Period | Actual | Previous |
| Consumer credit | Nov. | $23.7b | $5.8B |
| U.S. trade deficit | Nov. | -$63.2B | -$64.5B |
| Wholesale inventories | Nov. | -0.2% | -0.4% |
| Initial jobless claims | Jan. 6 | 202,000 | 2023,000 |
| CPI | Dec. | 0.3% | 0.1% |
| Core CPI | Dec. | 0.3% | 0.3% |
| CPI (year-over-year) | 3.4% | 3.1% | |
| Core CPI (year-over-year) | 3.9% | 4.0% | |
| Budget statement | Dec. | $129B | -$85B |
| PPI | Dec. | -0.1% | -0.1% |
| Core PPI | Dec. | 0.2% | 0.1% |
| Core PPI (year-over-year) | 2.5% | 2.4% |
Closing Prices for the Week
| Contract | Close |
|---|---|
| Dow Jones Industrials Average | 37,592.98 |
| Nasdaq Composite | 14,972.76 |
| S&P 500 Index | 4,783.83 |
| CBOE Volatility Index | 12.70 |
| S&P GSCI | 538.33 |
| U.S. Dollar Index | 102.404 |
| 10-Year T-Note (Mar ’24) | 112-190 |
| Crude Oil WTI (Feb ’24) | 72.68 |
| Natural Gas (Mar ’24) | 2.617 |
| Gold (Feb ’24) | 2,051.6 |
| Silver (Mar ’24) | 23.329 |
| Corn (Mar ’24) | 447-0 |
| Wheat (Mar ’24) | 596-0 |
| Soybean (Mar ’24) | 1224-2 |
| Coffee (Mar ’24) | 180.00 |
| Sugar #11 (Mar ’24) | 21.61 |
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