Weekly Economic Update: February 12, 2024

The Markets (as of market close February 9, 2024)

Stocks closed higher last week, with the S&P 500 and the Nasdaq reaching record highs. Traders were encouraged by generally favorable fourth-quarter corporate earnings data and a downwardly revised Consumer Price Index for December. All major benchmark stock indexes gained ground, led by the Russell 2000 and the Nasdaq. Last week saw information technology, communication services, industrials, and consumer discretionary lead the market sectors, while utilities and consumer staples trended lower. Crude oil prices continued to rise last week amid ongoing Middle East tensions.


Last Week’s Economic News

  • Business activity in the services sector expanded in January at the fastest pace since June 2023. New orders increased in both the domestic market and for exports. The increase in demand spurred more hirings by service firms. At the same time, inflationary pressures softened, with costs to service providers rising at the slowest pace since June 2020. The S&P Global US Services PMI Business Activity Index posted 52.5 in January, up from 51.4 in December. The latest reading marks the fourth straight month of expansion in the services sector.
  • The latest data from the Bureau of Economic Analysis shows the December trade deficit was $62.2 billion, up $0.3 billion, or 0.5%, from the November deficit. December exports were $258.2 billion, $3.9 billion, or 1.5%, more than November exports. December imports were $320.4 billion, $4.2 billion, or 1.3%, more than November imports. For 2023, the goods and services deficit was $773.4 billion, a decrease of $177.8 billion, or 18.7%, from 2022. Exports increased $35.0 billion, or 1.2%. Imports decreased $142.7 billion, or 3.6%.
  • The national average retail price for regular gasoline was $3.136 per gallon on February 5, $0.041 per gallon higher than the prior week’s price.
  • For the week ended February 3, there were 218,000 new claims for unemployment insurance, a decrease of 9,000 from the previous week’s level. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended January 27 was 1.2%, a decrease of 0.1 percentage point from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended January 27 was 1,871,000, a decrease of 23,000 from the previous week’s level, which was revised down by 4,000.


Eye on the Week Ahead

January inflation data is available this week with the release of the Consumer Price Index, the Producer Price Index, and the report on import and export prices. Consumer prices rose marginally in December, with the CPI increasing 0.3% for the month and 3.4% for the 12 months ended in December. Producer prices, on the other hand, ticked down 0.1% in December and were up only 1.0% for the year.

Have a nice week!





Robert G. Carpenter

President & CEO
Baltimore-Washington Financial Advisors