Weekly Economic Update for March 14, 2022

In this week’s recap: Ukrainian War impacts global economy

THE WEEK ON WALL STREET

Intensifying hostilities in Ukraine continued to unsettle markets, as investors grappled with the war’s impact on the global economies.

The Dow Jones Industrial Average lost 1.99%, while the Standard & Poor’s 500 dropped 2.88%. The Nasdaq Composite index fell 3.53% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, gained 0.90%.1,2,3

MARKETS REMAIN STRESSED

Markets gyrated last week as Russia escalated its attacks on Ukraine, the U.S. banned imports of Russian oil, and more companies announced the suspension of business in Russia. Eastern Europe has added complexity to the Fed’s plans for raising interest rates to manage accelerating inflation, which has been exacerbated by a sharp rise in energy and other commodity prices.

The stock market saw brief moments of respite. Stocks rallied Tuesday on a news report that Ukraine would promise not to pursue NATO membership, but lost momentum before the close. Stocks rallied on Wednesday as oil prices tumbled, but were unable to follow-through on Thursday and then faded further into Friday’s close.

A FOUR-DECADE HIGH

Consumer prices rose 0.8% in February as energy and commodity prices pushed higher. This latest monthly report showed a year-over-year inflation rate of 7.9%, the highest level since January 1982. Excluding the more volatile food and energy prices, the 12-month increase was 6.4%, a slight bump from last month’s 6.0% year-over-year increase.⁴

Many economists hoped that inflation pressures would ease, but February’s inflation number suggested that the impact of sanctions and supply-chain disruptions due to the invasion of Ukraine may likely feed further price increases for the foreseeable future.

T I P O F T H E W E E K

What do your children know about money? There’s never a wrong time to talk to your children about its value and impact.

THE WEEK AHEAD: KEY ECONOMIC DATA

Tuesday: Producer Price Index.

Wednesday: Retail Sales. Federal Open Market Committee (FOMC) Announcement.

Thursday: Housing Starts. Jobless Claims. Industrial Production.

Friday: Existing Home Sales. Index of Leading Economic Indicators.

Source: Econoday, March 11, 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.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: Coupa Software, Inc. (COUP).

Thursday: FedEx Corporation (FDX), Dollar General Corporation (DG).

Source: Zacks, March 11, 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.

Q U O T E O F T H E W E E K

“The strongest of all warriors are these two — Time and Patience.”

LEO TOLSTOY

T H E W E E K L Y R I D D L E

You are at sea, it is mid-July, and your ship has reached a unique spot on earth. If you sail north, it will be summer; if you sail south, it will be winter. If you sail east, it will be Friday, but if you sail west, it will be Saturday. Precisely where in the world are you? (Hint: your ship is in the Pacific Ocean, near the island nation of Kiribati.)

LAST WEEK’S RIDDLE: There is a word (four letters long) that begins with the letter I. If you put the letter A at the front of this four-letter word, it becomes a five-letter word which is pronounced exactly the same. Name both words?

ANSWER: Isle and Aisle.

This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such.

All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.

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CITATIONS:

1. The Wall Street Journal, March 11, 2022

2. The Wall Street Journal, March 11, 2022

3. The Wall Street Journal, March 11, 2022

4. The Wall Street Journal, March 10, 2022