Stocks catch a bid, warning signs flash

Stocks spent last week digesting the sharp gains of previous weeks as investors assessed a tightening yield curve, the war in Ukraine, and an uncertain outlook for economic growth and inflation.

For March, the S&P 500 increased by 3.58%, the Nasdaq 100 added 4.22%, and the Dow Jones Industrial Average added 2.32%.

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U.S. Stocks Bid Up, Yield Curve Inverts

After negative results in January and February, the S&P 500 found buyers as the end-of-quarter neared. The S&P 500, Dow Jones Industrial Average, and Nasdaq have all been clawing back at the declines from January and February.  We’ll see how the positive finish to the quarter trickles over into Q2. 

While U.S. stock indexes were rising in March, bonds were falling. Yields have been on the rise, and there’s been some chatter about the currently inverted yield curve. The yield curve is inverted when US 2-year notes have a higher yield than 10-year notes. 

Commodities High, Inventories Low

Walk out the door and get ready to spend–that’s how it’s felt lately, with the prices of all sorts of goods and services soaring. 

From industrial supplies to food, consumer discretionary items to services, it has been a wild month (and year) for almost all types of pricing. This was evident in the February Consumer Price Index (CPI)  data, which showed inflation rising 7.9%.

Jobs Data Strong, Misses Estimates

Fresh jobs data from April 1st showed 431,000 jobs added in March, slightly below the 490,000 estimate. The unemployment rate declined to 3.6% as corporate America continued its hiring spree–with notable strength in the leisure and hospitality sectors.

This Week:

Key Economic Data

• Monday: Factory Orders.
• Tuesday: Institute for Supply Management (ISM) Services Index. 
• Wednesday: Federal Open Market Committee (FOMC) Minutes. 
• Thursday: Jobless Claims.

^{Source: Econoday, April 1, 2022
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

Companies Reporting Earnings

Wednesday: Levi Strauss & Co. (LEVI).

Thursday: Conagra Brands (CAG).

^{Source: Zacks, April 1 2022
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

Ready to invest? Hop on my calendar here.

"Behind every stock is a company, find out what it's doing." 

– Peter Lynch

Self-Employed Tax Obligations

There are a few tax considerations to consider when you work for yourself. Generally, you’re required to file and pay estimated taxes every quarter.

Determine if you are subject to tax: Subtract your business expenses from your income. If your expenses are less than your income, the difference is part of your income. If your expenses are more than your income, the difference is a net loss.

Make quarterly payments if you’ve determined you need to make quarterly payments using Form 11040-ES.

Filing annually: If you’re filing annually, you’ll need to use Schedule C to report income or loss. To file your Social Security and Medicare taxes, you should file Schedule SE Form 1040.

Deductions: If you’re using part of your home for business, you may be able to make certain deductions, such as for your office or a portion of your home’s square footage used for business purposes.

* This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁷

Restorative Yoga - Long and Easy Stretching

Whether you have been curious about yoga but have never tried it, or if you're a seasoned yogi looking for something new, restorative yoga has something for everyone. This gentle yoga uses props like blocks, blankets, and straps. Stretches and poses are held for a longer time, yielding many benefits.

Here are a few ways that restorative yoga can be beneficial for many people:

• It can help with neck, low back, hip, and shoulder pain
• It can help with insomnia
• All ages widely practice it, and modifications are available
• It can relax the mind and help with anxiety
• It may help to cope with serious illnesses and life events
• It may improve respiratory and circulatory function

Check your local yoga studios or gyms to enroll in a restorative yoga class. If you can’t find one, there are online yoga courses you can try. It might be a stretch worth taking (ask your doctor if yoga might be right for you).

Tip adapted from www.mindbodygreen.com⁸

What do a shark, a zipper, and a comb all have in common?

Last week’s riddle:  New furniture will be delivered to your office on the day before five days from the day after tomorrow. If today is August 18, when will the furniture arrive?  Answer: August 24.

Lava falls near Kilauea Volcano, Big Island, Hawaii

Footnotes and Sources

^{1. The Wall Street Journal, April 1, 2022}

^{2. The Wall Street Journal, April 1, 2022}

^{3. The Wall Street Journal, April 1, 2022}

^{4. CNBC, March 29, 2022}

^{5. CNBC, March 30, 2022}

^{6. The Wall Street Journal, April 1, 2022}

^{7. IRS.gov, September 15, 2021}

^{8. Mindbodygreen.com, June 27, 2012}

^{Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.}

^{The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.}

^{The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.}

^{The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.}

^{U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.}

^{International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.}

^{Please consult your financial professional for additional information.}

^{This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.}

^{Copyright 2022 FMG Suite.}