Congress set for a busy January

Eagle Wealth Management |
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Weekly Market Commentary

The Senate and the House are back in session, but they’re unlikely to get much done before the Christmas holiday — which means January is going to be busy.

As Thanksgiving approached, Congress navigated a potential government shutdown crisis by swiftly approving a short-term budget package.

Newly elected House Speaker Mike Johnson took the helm, proposing a novel two-step government funding plan.  He’s hoping to give the House more time to achieve full-year agency funding bills through the regular appropriations process instead of the temporary continuing resolutions (CRs).1 

Yet this strategy merely extends the deadline until January 19 for specific budgets such as Transportation, Housing, and Urban Development, and pushes the timeline to February 2 for others like Defense and Health & Human Services.2 

Here's the kicker—Congress is set to depart from the hustle and bustle of D.C. as soon as December 15th, returning to session on January 9.

This timeline leaves just a handful of days before the first looming deadline. House Speaker Johnson made it clear there won't be any more quick-fix, short-term solutions this time around.2

Beyond the crucial spending bills, Congress also has a list of items waiting in the wings. Proposals for funding allocations concerning Israel, Ukraine, and the southern border are on the table, ready for their turn under the legislative spotlight.

If this sounds like a recipe for January news headlines filled with uncertainty and potential disruptions, you may be correct. Brace yourself for a bit of market turbulence and political whirlwinds.

While we remain optimistic, history suggests that Congress might take its sweet time working through the many issues. We’ll be here to help you navigate the headlines and answer any questions you may have.

Until next week,

Your Eagle Wealth Team

Medicare Open Enrollment Ends Thursday

 Don’t forget - the Medicare open enrollment deadline is on December 7th, 2023. This is your last chance to review your current plan and make any changes that better suit your needs for the upcoming year. 

 

 

Toys for Tots Box at Eagle Wealth

 

Eagle Wealth is participating in the Marine Toys for Tots program again and we need your help!  This national organization distributes toys to less fortunate children during the holiday season, spreading hope and joy to others. 


 

The donation box is set up in our lobby and our team can’t wait to help fill it up. We’ll make a financial gift for every toy donated, so please join us in the fun!  Drop by our office with a (new and unwrapped) toy.  We’ll collect gifts through December 19th.
 
Click here for more information about the program.
 
P.S.  If you live outside of Central Oregon you can still participate.  Let us know if you make a donation locally and we'll put another toy in the box.

 

 

The Week on Wall Street

A Friday rally turned an otherwise mixed week for stocks into a solid performance.

The Dow Jones Industrial Average picked up 2.42%, while the Standard & Poor’s 500 gained 0.77%. The Nasdaq Composite index rose 0.38% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, ended marginally higher by 0.13%.3,4,5

 

Stocks Move Higher

The stock market digested November’s robust gains for much of last week but rallied strongly amid falling bond yields on the last trading day.

Market sentiment remained positive as the Fed’s preferred measure of inflation showed ongoing signs of softening inflation pressures, boosting hopes that the Fed may be able to end its rate hikes and consider rate cuts sometime next year. Investors also welcomed news of solid spending in early holiday sales reports.

The declines in bond yields reflect that the financial markets are positioning for a rate cut soon, even brushing off Fed Chair Powell’s Friday comments suggesting it was premature to consider monetary loosening.

 

Inflation Eases

The Personal Consumption Expenditures Price index (PCE)–the Fed’s preferred measure of inflation–was released last week, showing core PCE (excludes energy and food) rose 0.2% in October and 3.5% from a year ago. Both were lower than September’s readings of 0.3% and 3.7%, respectively. Perhaps most notably, core prices rose at a 2.5% annualized rate over the last six months, close to the Fed’s target rate and a big improvement over the previous six-month annualized rate of 4.5% ending April.6

The report also reflected a slowdown in consumer spending, as October’s 0.2% increase was lower than September’s 0.7% gain, a possible indication of the impact of the resumption of student loan repayments, higher prices, and shrinking savings.7

 

 

Any companies mentioned are for informational purposes only, and this should not be considered a solicitation for the purchase or sale of their securities. Any investment should be consistent with your objectives, time frame, and risk tolerance

 

 

1 https://www.cnbc.com/2023/11/14/house-passes-bill-to-avoid-government-shutdown-senate-to-vote-next.html

2. FundStrat.com, November 20, 2023

3. The Wall Street Journal, December 1, 2023

4. The Wall Street Journal, December 1, 2023

5. The Wall Street Journal, December 1, 2023

6. The Wall Street Journal, November 30, 2023

7. The Wall Street Journal, November 30, 2023

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