Portfolio Impact

We have a lot of information to look at, but really, we are focusing on the consumer who is taking charge of the markets this week with a lot of inspiration. There is a lot of important data points that we think will impact your portfolios and the economy at large. The two main economic data points that we are really focused on are about the consumer with the first one being the CPI. That is the Consumer Price Inflation, which we think may be higher than expected. We are seeing that impact interest rates. When interest rates go up, bond prices go down. We are seeing that potentially impact our client’s portfolios. If inflation goes high for too long, then that may be negatively impactful to the individual’s ability to purchase goods. It could also negatively impact the value of the market and the more conservative investments within portfolios. In addition, later in the week, we are getting data on retail sales for the month of March. Expectations are for a 6% spike and the reason that is such a large spike is that in March we saw another wave of government check going to the consumer. The average person received $1,400. When the last stimulus was received back in January, we saw a spike in retail sales, so we are expecting a similar spike for March. This could also push prices higher again, as the consumer gets out there and spends money. Last year, most individuals in 2020 saved the government funds and invested those. We saw that go into the market and prices go higher for equities. We may see people spend this time around rather than saving, which could cause prices of consumer goods to go higher. So, there is a lot to watch with plenty of long-standing potential impacts with just a week’s worth of data.

Technical Analysis

On this past Friday, the S&P 500 closed at a price of 4,128. That pushes our new resistance level to 4,170 and pushes our support level to 4,080. The 50-day moving average does not calculate for calendar days. It is based on the days that the market is open. The 50-day moving average has finally pushed over 3,900, currently sitting at 3,914. This is going to be a very important way to look at the retail sales data to see where we are going in relation to the market. This will tell us if we can keep this bullish tone in the market. The consumer coming back really should boost the earnings, which should help push prices of the stock market higher. A lot of big data this week that will push into the rest of 2021 to see how things are going. Can we sustain these higher prices in the stock market? A lot of that is going to be driven by a safe and healthy consumer.

 

Trey Booth, CFA®, AIF®
Senior Vice President
Wealth Consultant
Email Trey Booth here

Adam Vansant, AIF®
Associate Vice President
Wealth Consultant
Email Adam Vansant here

 

Fi Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. Fi Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

Economic forecasts set forth in this presentation may not develop as predicted.

No strategy can ensure success or protect against a loss.
Stock investing involves risk including potential loss of principal.

Securities and advisory services offered through LPL Financial, Member FINRA/SIPC and a registered investment advisor.

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