weekly market update 1/24/2025

Stocks rose for the second consecutive week as President Trump’s initial policy moves did not include tariff actions, the fourth quarter earnings seasons continued to come in better than expected, and interest rates have stopped climbing.  The S&P 500 earnings season is only about 15% complete, so next week will be important as the mega cap companies Microsoft, Meta, Apple, and Tesla are all scheduled to report.  In addition, while it was a quiet week for economic data, next week is much busier and headlined by consumer confidence for January, fourth quarter US GDP, and the Federal Reserve’s preferred inflation gauge the PCE.  Lastly, Wednesday will bring the Fed’s first FOMC meeting announcements of 2025.  The Fed is expected to leave interest rates unchanged, but the market will be closely monitoring the committee’s updated guidance and Fed Chair Jerome Powell’s press conference.

SMALL BUSINESS OPTIMISM

Last week the National Federation of Independent Business (NFIB) released its monthly survey results of small business owners and respondents are feeling good.  The NFIB Small Business Optimism Index surged to its highest levels since 2019 and posted its largest 2 month increase in history (see chart below).  It remains to be seen if this rising optimism translates to a boost in economic growth and profits, especially with tariff and immigration policy very much in flux, but generally it bodes well and is something we will be watching closely.

Ian G. Browning, CFA
Managing Director, Investment Strategies | Shareholder

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