Weekly Market Check-Up

Markets took a bit of a breather last week after a month-long rally, but the S&P 500 still remains up by about 11% for the year. 

• Tiny Tweaks –  A modest 5% correction in April suggests a possibility of more volatility ahead, but economists don’t foresee it morphing into a prolonged bear market.
• Tech Leads the Way – Spearheaded by companies like NVIDIA and Microsoft, large-cap technology continues to buoy the markets, particularly in the AI sector.

Analysts foresee the bull market that started in October 2022 potentially stretching into the years ahead, driven by improving inflation trends, a possible Fed rate-cutting cycle, and robust earnings growth.

• Bullish Persistence – Historically, bull markets outlast and outperform bear markets. Since 1946, the average bull market has lasted about 5.6 years with gains of 192%, while bear markets average 16 months with a 34% decline.
• Just Getting Started – Given that the current bull market is a little over 1.5 years old with the S&P 500 up 48%, history suggests there may be more time and price appreciation ahead.

Pricing and availability in the auto industry are showing some recent fluctuations worth noting:

• Overall Price Trends — Wholesale prices are trending downward, presenting potential opportunities for savvy dealers to capitalize on.
• On the Up and Up — Full-size and sporty cars are experiencing price hikes, likely due to a surge in consumer demand and supply constraints.
• Keep on Truckin’ — Trucks are seeing price drops, making them a potential bargain for inventory acquisition.
• Auction Sales — The auction sales rate dipped to 55% this week, down 1% from last week, indicating a slight decrease in sales activity.