Ron Elliard Business Blog and World View
Blogging about Financial Markets, Economics and the World
This is the start of what I hope to be a very long conversation regarding business, economics, markets and of course the occasional quicky little fact. But for now, let’s start from where we are and todays view.
Stocks
Markets were higher around the world, with the S&P 500 gaining 6.19%, the Russell 2000 adding 5.43% and the NASDAQ rising 8.20%. International developed markets (MSCI EAFE) increased 5.63% while emerging markets (MSCI EEM) rose 3.51%. Growth outperformed value stocks. By sector in the US, consumer discretionary and tech were the leaders while energy and utilities were the laggards.1
Fixed Income
The Federal Reserve, as expected, raised the Fed funds rate by 0.25% from near zero to between 0.25% and 0.50%.2 It was the first increase by the Fed since 2018, and the central bank predicted it could rise to 1.90% by yearend and 2.80% by the end of 2024. Russia’s invasion of Ukraine is adding to uncertainty around the outlook, which will likely boost inflation – from their previous estimate of 2.6% to 4.3% – and dampen economic growth this year – from the 3.6%-4.5% range to the 2.5-3.0% range.3
Commodities
With the war in Ukraine, the price of wheat has increased dramatically in the past month. Russia and Ukraine together supply about 26% of the world's wheat exports, and shipments have already been disrupted. The contracted price of wheat for May delivery jumped 54% in just nine trading days starting Feb. 23 from $8.84 to $13.63 per bushel before coming back below $11 per bushel.4
Economic Data
Wholesale prices rose a sharp 0.8% in February from January, the largest increase in 40 years. On a year over year basis, wholesale prices were up 10.0%. Core wholesale prices (which excludes food, energy, and retail) were up 6.6% year over year; this is viewed by the Federal Reserve as a better indicator of inflation.5
Did you know…
The famous Las Vegas Strip is not actually in the city of Las Vegas. It sits immediately south of the city and is located in the unincorporated towns of Paradise and Winchester, Nevada. That’s why gaming data for the area is reported by Clark County, not the city of Las Vegas.
RAMPART Wealth Management Ronald Elliard