Sell in May and go away? Not so fast.
The S&P 500 rose 1.85% last week, bringing its year-to-date total back to nearly 10%. It’s the third straight week of gains for equities after prices experienced their first 5% decline since last October. Gold was even better, rising 2.5%.
This week, all eyes will be on inflation data for April. First up is tomorrow’s Producer Price Index update, where consensus expectations call for a slight acceleration to 2.2% on the headline number. Wednesday’s CPI report will be even more important. Core inflation - the measure that excludes volatile measures like food and energy - accelerated in March after 11 consecutive months of declines. Forecasters are hoping expecting that inflation will resume its downward trend and dip to a multi-year low of 3.6% in April.
Relatively Speaking
It may be a new year, but some things in 2024 look awfully familiar to 2023. The Communication Services and Information Technology sectors are both outperforming the S&P 500, with Communications the year-to-date leader, up nearly 19%. Participation in the bull market has broadened out, though. Last year, only the growth sectors did better than the benchmark index. This time around, 6 of the 11 sectors have outperformed. One thing that hasn’t changed? Real Estate is lagging. That sector is down almost 6%.
Risk-off areas of the market have dominated over the past month, as the Utilities jumped almost 10%, and the Consumer Staples rose 4.5%. Risk-off outperformance is often a reflection of a waning market, but it’s hard to make that argument right now - 9 of the 11 sectors were up over the period.
In Case You Missed It: Last Week’s Insights
Housing Inflation is Too High
Financials Sector Outlook
Which Gold Stocks Do We Want to Buy?
What's Ahead
Here are the key data releases and events to keep on eye on in the coming days.