April 2024 Market Update

April 22, 2024

In this April market update, our Chief Investment Officer, Brian Andrew, CFA®, examines the latest market trends and discusses their implications for the month ahead.

Key Takeaways:

Economic Performance: Despite previous predictions of a “soft landing,” the economy has shown resilience with significant job growth and strong indicators in both manufacturing and services sectors. The labor market exceeded expectations with over 300,000 new jobs, and the purchasing managers index (PMI) indicated expansion globally. Commodity prices, including oil and copper, have also increased, suggesting robust global economic growth.
Interest Rates and Inflation Concerns: Improved economic data has led to a rise in interest rates and sustained high inflation, challenging the earlier expectation that inflation would be quickly controlled. The bond market reflects these conditions with higher yields, indicating that investors expect continued or increased Federal Reserve rates to combat inflation.
Stock Market Adjustments: The stock market has adjusted to these economic realities, with a notable correction after initial gains. Higher interest rates have made future earnings less appealing, causing stocks to decline and investors to recalibrate their expectations for growth. Despite uncertainties such as geopolitical tensions and domestic political issues, the market has shown a degree of resilience.
Investment Strategy Insights: Merit Financial Advisors are adjusting their strategies in response to these conditions by diversifying investments and potentially increasing exposure to underperforming market segments that might offer better value. The firm remains optimistic about sectors that have shown strong balance sheets and growth potential, including those benefiting from advances in artificial intelligence.

We hope you find this video educational and informative. If you have any questions, please contact your Merit Financial Advisor.

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