{"id":7011,"date":"2023-05-30T13:45:22","date_gmt":"2023-05-30T19:45:22","guid":{"rendered":"https:\/\/www.keystonefinancial.com\/?post_type=oi_article&p=7011"},"modified":"2023-05-30T13:45:24","modified_gmt":"2023-05-30T19:45:24","slug":"market-commentary-may-30-2023","status":"publish","type":"oi_article","link":"https:\/\/www.keystonefinancial.com\/articles\/market-commentary-may-30-2023","title":{"rendered":"Market Commentary | May 30, 2023"},"content":{"rendered":"\n
It\u2019s a three-ring circus!<\/p>\n\n\n\n
For centuries people have embraced the circus. Enjoying the sticky fluff of cotton candy while elephants, clowns and trapeze artists perform in the spotlights. Merriam Webster Dictionary defines the experience as wild, confusing, engrossing and entertaining.<\/p>\n\n\n\n
Some aspects of that description apply to recent financial market activity. Last week, we saw:<\/p>\n\n\n\n
Inflation flying above the Federal Reserve (Fed)\u2019s target. Inflation re-entered the limelight last week. The Personal Consumption Expenditures (PCE) Index, one of the Fed\u2019s favorite inflation gauges, showed that inflation rose in April along with consumer spending. That was unwelcome news for investors who hoped the Fed would leave the federal funds rate unchanged at its June meeting and, possibly, begin to lower rates later this year. By the end of last week, trading suggested there was a strong chance the Fed would raise rates in June, reported Jeff Cox of CNBC.<\/p>\n\n\n\n
Artificial Intelligence (AI) drawing crowds. The thrill of AI has attracted investors and lifted stock markets higher this year. \u201cSome stocks seen as AI winners \u2013 such as semiconductor makers and software developers \u2013 have more than doubled in value as traders bet on massive growth in the industry, even as fears mount over waves of job losses as everyday tasks become automated,\u201d reported Graeme Wearden of The Guardian. Opinions vary about whether the rally is sustainable.<\/p>\n\n\n\n
The debt ceiling barreling toward the center ring. Negotiators have reached a tentative agreement that would prevent a debt-ceiling default. Now, the agreement must be accepted by Congress, reported Steve Holland, Gram Slattery and Katharine Jackson of Reuters. No one is certain what will happen if Congress doesn\u2019t accept the deal. Natalie Sherman of the BBC reported, \u201c[A U.S. default] has never happened before so it is not entirely clear\u2026The government would no longer be able to pay the salaries of federal and military employees, and Social Security [checks] \u2013 payments that millions of pensioners in the U.S. rely on \u2013 would stop. Companies and charities that count on government funds would be in peril.\u201d<\/p>\n\n\n\n
With so many issues vying for attention, what should investors do? The answer is more straightforward than you might imagine: focus on their financial goals. The weight of evidence accumulated over time supports the idea that holding a well-allocated and diversified portfolio built to meet your financial goals is a sound choice. While past performance is no guarantee of future results, financial markets have weathered a variety of calamitous events \u2013 including world wars \u2013 and come through.<\/p>\n\n\n\n
Last week, the Standard & Poor\u2019s 500 Index and Nasdaq Composite gained, while the Dow Jones Industrial Average lost ground, according to Barron\u2019s. Yields on most maturities of U.S. Treasuries finished the week higher.<\/p>\n\n\n\n