CWS Market Review – March 15, 2024
“The conventional view serves to protect us from the painful job of thinking.” – John Kenneth Galbraith
Is the stock market in a bubble? We hear that question every time the market puts on a nice show. After all, the S&P 500 has raced ahead by 25% in less than five months. That’s quite a run, and we can’t expect it to last forever.
Still, there doesn’t appear to be any immediate danger to stocks. Of course, if you’re looking for reasons to sell, you’ll surely find then. But keeping your cool, holding high-quality stocks and letting your winners run is a much wiser decision.
Wall Street recently passed two important tests: the February jobs report and the CPI report. Both were largely what investors had been expecting. On Tuesday, in fact, the S&P 500 closed at another all-time high (as did CWS!).
What about the Federal Reserve? Historically, its track record of gumming up bull markets is without parallel. The Fed’s getting together next week, but don’t expect any interest-rate hikes or cuts. Still, the Fed is probably leaning towards a rate cut soon, perhaps as early as June, and that would be good for stocks.
On Thursday, we learned that shoppers are still in a buying mode. Retail sales for February increased by 0.6%. That’s a big improvement over January’s 1.1% drop, which was due to some nasty weather across the country. Last month, sales at home-improvement stores increased by a solid 2.2%.
In this week’s issue, I’m going to preview two Buy List earnings reports coming out next week. On Monday, SAIC is due to report. I like to call this company “the Pentagon’s IT help desk.” SAIC is already a 15% winner for us this year, and it’s increased its guidance three times this fiscal year.
On Thursday, FactSet is due to report. Their last report was quite good, and the stock is getting close to making its first all-time high in over two years. I also have some Buy List updates for you, but first, let’s preview next week’s earnings reports.