Stocks experienced a rather delightful week after five weeks of flat or negative market performance. The market posted its strongest return today after the Supreme Court ruled that the President of the United States exceeded his authority by invoking a federal emergency-powers law to impose tariffs. There were several significant macroeconomic signals this week: the Federal Reserve’s January meeting minutes signaled a meaningful hawkish tilt, fourth-quarter GDP came in significantly lower than expected, and one of the most important inflation gauges came in higher than expected. While these signals are not favorable for the market, they do not yet establish a trend. Furthermore, there is the possibility that geopolitical risks could escalate in the Middle East, a development that has sent oil prices higher.
Here are the returns of the major stock indices for this week. The Dow Jones Industrial Average rose a quarter percent to 49,626. The NASDAQ gained 1.13% to 25,013. The S&P 500 increased 1.07% to 6,910.
Yields rose slightly this week, with the 5-year U.S. Treasury yields edging up 5 basis points to 3.65% and the 10-year yield rose 4 basis points to 4.09%. These changes are not as meaningful compared to the previous week’s decline.
Currently, the trajectory around tariffs remains unclear, as the President has vowed to explore other channels to implement them. The geopolitical situation still has room for change. In addition, recent developments involving Blue Owl, an alternative investment asset management company, have raised concerns about the private credit industry. We will provide future updates if anything more significant comes out.
Next week, another inflation gauge will be released, and we will continue to monitor market developments.
This is Adams Wealth Advisors. We wish you an enjoyable weekend, and thank you for listening.