Stocks Up On Friday, But Mostly Lower For The Week

Plus 5 Just-Added Strong Buys Stocks Up On Friday, But Mostly Lower For The Week [Kevin Matras - EVP - Photo] Profit from the Pros By Kevin Matras Executive Vice President Stocks Up On Friday, But Mostly Lower For The Week [Stocks Up On Friday, But Mostly Lower For The Week]Image: Bigstock Stocks were up on Friday, but mostly lower for the week for the third week in a row. The Dow, however, was up for the week, cutting their weekly losing streak to just 2 weeks in a row. Friday's Personal Income and Outlays report showed the Personal Consumption Expenditures (PCE) index (the Fed's preferred inflation gauge), was up 0.1% m/m. On a y/y basis, it came in at 5.5%, down from last month's 6.1%, and their summer high of 6.8% in June. Ex-food and energy, it was up 0.2% m/m. On a y/y basis, it came in at 4.7%, which was down from last month's 5.0%, and their high of 5.3% in Q1. It's clear that inflation is heading in the right direction, i.e., down. That was previously underscored by declines in both the Consumer Price Index (CPI), and the Producer Price Index (PPI) earlier in the month (and really for the last few months in a row). We'll get another look at all three before the Fed's next FOMC Announcement on February 1, 2023. But for now, the recent trajectory is definitely good news. Friday's Durable Goods Orders were down -2.1% m/m. But excluding the volatile transportation sector, it was actually up 0.2%. New Home Sales were up a better than expected 5.8% m/m, although, they were still down -15.3% y/y. And Consumer Sentiment also came in better than expected at 59.7 vs. expectations for 59.1%. Today we'll get the International Trade in Goods report, Retail and Wholesale Inventories, the Case-Shiller Home Price Index, and the Dallas Fed Manufacturing Survey. This week is the last week of the year. And it's a shortened trading week. Next week will also be a shortened trading week as the markets will be closed on Monday in observance of New Year's Day. In the meantime, we'll see if we can get an end-of-year rally going, or so-called 'Santa Claus' rally. (Seems weird to be looking for a Santa Claus rally now that Christmas is over. But Santa Claus rallies typically take place in the last week of the year. So let's see if the market can end on a good note.) We will also soon see if the market can begin on a good note as well. Fortunately, the statistics are on our side for that. The 4-year Presidential Cycle shows that year 3 (that's 2023), is the best year of all 4 years. In fact, since 1950, stocks have always gone up in the year after midterms, with an average 12-month forward return of 18.6%. But we still have 4 more trading days to go in 2022. So traders will be focusing on that first. 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