THE WEEK ON WALL STREET
Strong earnings from several mega-cap technology companies offset renewed regional banking jitters and weak economic data, leaving stocks higher for the week. The Dow Jones Industrial Average gained 0.86%, while the S&P 500 added 0.87%. The Nasdaq Composite index rose 1.28% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, lost 0.60%.
FACT OF THE WEEK
On May 1, 1851, the Great Exhibition opened to wide acclaim in the Crystal Palace in London. Inside the Crystal Palace, a giant glass-and-iron hall designed by Sir Joseph Paxton, more than 10,000 exhibitors set up eight miles of tables. Technological wonders from around the world were on display, but the exposition was clearly dominated by Britain, the premier industrialized nation and workshop of the world. Conceived by Prince Albert, husband of Queen Victoria, the Great Exposition was a rousing success, hosting 6 million visitors before it closed in October. The many goods displayed ranged from kitchen appliances to false teeth, silks to farm machinery.
MARKET MINUTE
Earnings Drive Rebound
It was a very busy week of earnings reports, but none more important than those from the Big Tech names. After two days of sharp losses on revived regional banking fears and otherwise lackluster earnings results, stocks rallied powerfully on a succession of positive earnings surprises from several mega-cap companies. Also aiding the sentiment was last week’s first quarter Gross Domestic Product (GDP) report. Though the report showed muted economic growth that fell short of expectations, investors were encouraged by strong consumer spending.
Slowing Growth
In a sign that higher rates are slowing economic growth, first-quarter GDP slowed to a 1.1% annualized growth rate as healthy consumer spending helped offset a decline in business investment and a slowdown in nonresidential investment. Economists had expected first-quarter GDP growth to come in at 2%. The business inventory investment slowdown reduced the headline GDP number by 2.26%. The initial estimate of GDP also reported some disappointing inflation news as the quarter-over-quarter Personal Consumption Expenditures Price Index, the Fed’s preferred inflation measure, rose 4.2%, which was higher than the 3.7% forecast.
FINANCIAL STRATEGY OF THE WEEK
For many of us, Social Security plays an important part in our financial plans for retirement or a later stage of life. Even if you’re years away from applying for benefits, there are good reasons to set up your online Social Security account.
Ensure Accurate Reporting. You can go online to ensure there aren’t any gaps in your earnings. The amount you receive from Social Security is based on how much you’ve earned over your working career. Many people change jobs frequently, increasing the possibility an employer will fail to report their earnings, use the wrong Social Security number, or use an incorrect name. If there is a mistake, you’ll want to fix it as soon as possible, so you aren’t shortchanged when you apply for benefits.
Protect Against Fraud. By setting up an online Social Security account, you’ll prevent anyone else from doing so. Much like income tax fraud, identity thieves sometimes set up Social Security accounts and file for benefits using other people’s names. You don’t want to wait until you retire to find someone else is collecting your hard-earned benefits. The most effective way to prevent that is by creating your own account.
Access to Documents. You can easily replace a lost or stolen Social Security card – for free. With an online account, there’s no need to sit through traffic to get to your local office and wait in line for a new card. You can also download a printable copy of your Social Security 1099/Benefit Statement, the tax form the Social Security Administration mails each year in January. No need to wait.
Maintain Account. If you already receive Social Security, you can still benefit from having an online account. You can set up or change direct deposit or address information and get a benefit verification letter, which you may need if you’re applying for a loan. You’ll also be able to check the status of your Social Security benefits application from anywhere you can safely log in to your account.
If you’re wondering about the role of Social Security benefits in your retirement plans, call our office. We can help you evaluate your financial plan and the impact social security will have to ensure you’re on track to work toward the retirement you envision.