Stock Market This Week

Stock Market This Week – 01/27/24

Stock Market This Week

Stock Market This Week – 01/27/24

The U.S. economy grew yet again. However, even beyond that, the data indicated the Gross Domestic Product (GDP) beat expectations, increasing 3.3% after economists predicted a 2% rise. This percentage comes after a 4.9% rise last quarter. Moreover, many economists and politicians predicted a recession in 2023 because of high debt and interest rates. But it did not happen.

Furthermore, compared to other developed economies, America is outperforming most of them. The Euro area GDP was flat at 0.1% in the third quarter, and the fourth quarter is not expected to improve much. In addition, Japan’s GDP contracted in the third quarter. Clearly, things are looking rosy for the U.S., but why?

The simple answer is consumer spending. Despite high-interest rates, retail spending is climbing on the job market’s strength and low unemployment rate. Also, real income is rising because of the tight job market and low inflation. Comparing 2019 to 2023, the U.S. Treasury shows the median worker’s purchasing power is higher. They would have 1.7% or roughly $1,000 more to spend.

In my view, implications for the stock market are straightforward, as John Bogle would say: stay the course.

Since we ended with John Bogle, let’s focus on index funds. A nice application is Stock Rover. It has thousands of index funds and ETFs in its database. Simply analyze and compare the ones you find interesting. Click here to try Stock Rover for free* (14-day free trial).

Stock Market Overview

Data from Stock Rover* showed gains for the week, with the Energy sector leading the way. Reversing recent trends, the Russell 2000 performed well. It was followed by the S&P 500 Index, the Nasdaq Composite, and the Dow Jones Industrial Average (DJIA).

Eight of the 11 sectors gained this week. The Energy, Communication Services, and Financial Services sectors were top performers. However, the Healthcare, Real Estate, and Consumer Cyclical sectors were the worst performers.

Oil prices gained on lower supplies and tension in the Middle East, ending at ~$78. The VIX was flat at 13.3, which is still well below its long-term average. Gold declined to ~$2,018 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*

The markets continue to move upward on the economy’s strength. The Nasdaq leads the way, followed by the S&P 500 and the DJIA. However, the Russell 2000 is still negative. Six of the 11 sectors have positive returns. The top performers in 2024 have been Communication Services, Technology, and Financial Services, while the Utilities, Basic Materials, and Real Estate sectors 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-1.5%
Dividend Aristocrats-0.2%
Dividend Champions-1.5%
Dividend Contenders+1.9%
Dividend Challengers-1.2%
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 26.55X, and the Schiller P/E Ratio is about 32.92X. 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, bear market, and rebound. Based on historical data, earnings multiples of more than 30X are overvalued.

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.


Receive a free e-book, “Become a Better Investor: 5 Fundamental Metrics to Know!” Join thousands of other readers !


*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.

Website | + posts

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.

Leave a Reply

Your email address will not be published. Required fields are marked *