Market Update: Wed, Jan 29, 2020 | LPL Financial Research

Daily Insights

Market fears subside. U.S. stocks are higher for a second day after the S&P 500 Index jumped 1% on Tuesday. Equity investors’ fears around the coronavirus outbreak seem to be subsiding for now, thanks to a round of encouraging earnings reports released over the past few days. The benchmark has dropped as much as 2.6% from record highs this year. That’s a relatively tame pullback, and more volatility could be ahead after a strong rally over these past few months.

Consumer confidence increases. The Conference Board’s Consumer Confidence Index rose to 131.6 in January, a five-month high. Consumer sentiment has increased for three straight months on signs of U.S.-China trade cooperation, including the phase-one deal signed January 15. We’re hopeful that the uptick in confidence hints at to another year of solid consumer spending.

Two important events. The economic calendar ramped up this week, and U.S. investors have two important macroeconomic events to focus on over the next few days. This afternoon, the Federal Reserve (Fed) wraps up its first meeting of 2020 with a policy announcement and Fed Chair Jerome Powell’s post-meeting press conference. On Thursday, investors will get their first look at fourth quarter gross domestic product data, a report that will officially close the books on a challenging 2019 for the domestic economy.

New year, new Fed challenges. A new wave of global uncertainty has spooked investors, and some have feared it could put too much strain on a weakened global economy without central bank intervention. Fed Chair Powell has a chance today to respond to the uptick in unnerving global headlines. On our LPL Research blog, we’ll outline our expectations for the announcement and highlight why we think the Fed may stay put on policy.


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