Stock Market This Week

Stock Market This Week – 01/20/24

Stock Market This Week

Stock Market This Week – 01/20/24

Look at the data. I like to say that when people who, in many cases, know better make claims like an impending market crash. At the moment, such a scenario seems unlikely. The S&P 500 Index set an all-time intraday and closing high on Friday. The Dow Jones is still above 37,000 and just shy of its peak. The Nasdaq keeps surging higher on the strength of mega capitalization technology stocks.

Clearly, the current state of the market is bullish, but whether it will crash in 2024 is a difficult question to answer. Time will tell, but the economy is growing, and unemployment is sub-4%. Further, mortgage rates are falling quickly from their peak in late October. In addition, the U.S. Federal Reserve has kept interest rates steady for three past meetings. It seems doubtful they will increase them again soon. Instead, the next move may be downward, which many investors view as positive for the stock market.

Consequently, I think it’s an excellent time to own equities, especially for buy-and-hold investors like me. Despite the market runup in the past few months, undervalued dividend growth stocks with solid yields are available.

A way to find undervalued equities is to create watchlists. I use Stock Rover as one tool. It works well because I can create lists of dividend growth stocks and sort them by returns, yields, and valuation metrics. The watchlists serve as a starting point for further research. Click here to try Stock Rover for free* (14-day free trial).

Stock Market Overview

Data from Stock Rover* revealed the market had a mixed week, with the Technology sector moving upward while small-cap stocks struggled. The Nasdaq Composite led the way. It was followed by the S&P 500 Index, the Dow Jones Industrial Average (DJIA), and the Russell 2000. However, the Russell 2000 had a slightly negative return for the second straight week.

Five of the 11 sectors gained this week. The Technology, Communication Services, and Financial Services sectors were top performers. However, the Real Estate, Energy, and Utilities sectors were the worst performers.

Oil prices fell this week, ending at ~$73.70. However, demand remains weak, supply is strong, and the quantity in storage is robust. Trends indicate oil prices should be stable. The VIX dropped ~5%+ to 13.3, which is still well below its long-term average. Gold declined to ~$2,032 per ounce.


Affiliate

Stock Rover is an award winning investment research platform.

  • The site has 8,500+ stocks, 4,000 ETFs, and 40,000 mutual funds.
  • Access to 650+ metrics, financial data, market news, stock and fund ratings, fair value, margin of safety, etc.
  • Includes brokerage integration, portfolio tracking, rebalancing, watchlists, alerts, future income forecasts, etc.

Click here to try Stock Rover for free (14-day free trial).


Stock Market Returns This Week
Source: Stock Rover*

After a weak start, markets have recovered. The Nasdaq leads the way, followed by the S&P 500 and the DJIA. However, the Russell 2000 is still negative. Four of the 11 sectors have risen. The top performers in 2024 have been Technology, Communication Services, and Healthcare. While Utilities, Basic Materials, and Energy are trailing.

YTD Stock Market Returns
Source: Stock Rover*

The dividend growth investing strategy started the year down. Larger market capitalization stocks are performing better than smaller ones. The table below shows their performance by category.

CategoryYTD Return (%)
Dividend Kings-2.0%
Dividend Aristocrats-1.0%
Dividend Champions-2.2%
Dividend Contenders+0.3%
Dividend Challengers-2.5%
Source: Stock Rover*

Affiliate

Stock Rover is an award winning investment research platform.

  • The site has 8,500+ stocks, 4,000 ETFs, and 40,000 mutual funds. 
  • Access to 650+ metrics, financial data, market news, stock and fund ratings, fair value, margin of safety, etc. 
  • Includes brokerage integration, portfolio tracking, rebalancing, watchlists, alerts, future income forecasts, etc.
  • Plus export to spreadsheets, dividend calendar, 10+ years of data history, etc.
  • Best Buy and Hold Screener by Investopedia
  • Editor’s Choice by American Association of Individual Investors (AAII).

Click here to try Stock Rover for free (14-day free trial).


Stock Market Valuation This Week

The S&P 500 Index trades at a price-to-earnings ratio of 26.27X, and the Schiller P/E Ratio is about 32.57X. These multiples are based on trailing twelve months (TTM) earnings.

The long-term means of these two ratios are approximately 16X and 17X, respectively. 

The market is still overvalued despite the recent correction and a bear market and rebound. Earnings multiples of more than 30X are overvalued based on historical data.

Resources

Curated Weekend Reading From Around The Web

Portfolio Management and Investing

Retirement

Financial Independence


Here are my recommendations:

Affiliates

  • Simply Investing Report & Analysis Platform or the Course can teach you how to invest in stocks. Try it free for 14 days. 
  • Sure Dividend Newsletter is an excellent resource for DIY dividend growth investors and retirees. Try it free for 7 days.
  • Stock Rover is the leading investment research platform with all the fundamental metrics, screens, and analysis tools you need. Try it free for 14 days.
  • Portfolio Insight is the newest and most complete portfolio management tool with built-in stock screeners. Try it free for 14 days.


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*This post contains affiliate links meaning that I earn a commission for any purchases that you make at the Affiliates website through these links. This will not incur additional costs for you. Please read my disclosure for more information.

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Prakash Kolli is the founder of the Dividend Power site. He is a self-taught investor, analyst, and writer on dividend growth stocks and financial independence. His writings can be found on Seeking Alpha, InvestorPlace, Business Insider, Nasdaq, TalkMarkets, ValueWalk, The Money Show, Forbes, Yahoo Finance, and leading financial sites. In addition, he is part of the Portfolio Insight and Sure Dividend teams. He was recently in the top 1.0% and 100 (73 out of over 13,450) financial bloggers, as tracked by TipRanks (an independent analyst tracking site) for his articles on Seeking Alpha.

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