Stocks finished last week with a big head of steam, and they’re off to the races again today. Oil and Treasuries are up a bit, too, while gold, silver, and the dollar are a tad weaker.
One of the biggest developments over the weekend was in politics, with Florida Governor Ron DeSantis throwing in the towel on his presidential bid. His withdrawal yesterday leaves a two-person Republican race between former President Donald Trump and former South Carolina governor Nikki Haley. But many observers say if she doesn’t beat Trump – or at least keep things very close – in New Hampshire tomorrow, she may be the next to bow out.
Invesco QQQ Trust (QQQ)
Meanwhile, tech stocks are taking the lead once again...helping to push the S&P 500 to a record high on Friday. The Invesco QQQ Trust (QQQ) is now up 3% year-to-date, and 50% in the last 12 months.
The strength followed several rocky sessions fueled by concern about Federal Reserve policy in the next few months. Treasuries sold off aggressively last week after traders pared bets on earlier, more aggressive Fed hikes. That said, markets are still expecting more than a full percentage point of cuts from Jay Powell & Co. this year.
One reason: Investors believe we’ll see some cooling in the economy as the year progresses. The outplacement firm Challenger, Gray & Christmas reported today that layoff announcements jumped 98% last year. Total cuts came in at 721,677, much more than the 363,832 cuts the firm counted in 2022. Layoffs were particularly widespread in the technology and retail sectors.