Hello, this is James Mayer, Branch Manager, from the Huffman Mayer Paolo Wealth Management Group of Wells Fargo Advisors. Welcome back to May’s edition of “the market recap”. We are excited to put the cold months behind us and we hope you all are too. Stay tuned until the end for our Shred-it 2023 event results. Let’s see what topics Phil has for us.
Thanks James
· Every quarter, FactSet tracks how many S&P 500 companies mention certain key words on their earnings calls. To no one’s surprise, one of these often-mentioned themes over the last few years has been the word “inflation.” Two hundred and seventy-eight such companies mentioned inflation on their conference calls, which was down for the third consecutive quarter and at its lowest point since the second quarter of 2021.
· As of May 17th, negotiations over raising the “Debt Ceiling”, or maximum amount of indebtedness the U.S. Treasury is allowed to take on. Republicans, led by Speaker Kevin McCarthy want cuts to government spending, including student loan forgiveness, a repeal of energy and climate tax credits, a reduction in the IRS budget, and work requirements for people to be eligible for certain government benefits programs, among other things. The Biden Administration wants to increase the $31.4 trillion debt ceiling without any additional conditions or spending reduction being imposed.
· According to a recent article in Bloomberg, the S&P 500 has become increasingly top-heavy as large technology company shares have rebounded this year. The six largest constituents of the index account for roughly 25% of the total market capitalization. This increasing concentration in reflected in performance numbers as well, with two companies accounting for almost half of the S&P 500’s year-to-date performance through the end of April 2023.
To summarize mentions of inflation by S&P 500 companies fell for the third straight quarter, to their lowest level since 2Q21. Debt ceiling negotiations are ongoing with House Republicans trying to extract spending concessions from the Biden Administration in exchange for increasing the $31.4T borrowing limit. Rebounding tech shares have increased the indexes concentration in its largest companies, with just two stocks accounting for half of S&P 500 returns through the end of April.
Now here is James & Ryan with the 2023 Shred-it event results.
JAMES: Thanks Phil.
We had a great time shredding and talking with friends this past shred it event. We wanted to share some extraordinary results with you.
RYAN: That’s right James. We shredded over 5,500lbs of paper. We saved 47 trees.
JAMES: That’s great! We also saved 1,056 gal of oil and 11,120 kilowatts of energy.
But most importantly, I ate 4 less doughnuts than I did last year.
RYAN: Wow! That diet is really paying off!
JAMES: We want to thank everyone who came out and showed support to United Way of Ashtabula County. We raised over $5,300 in 3 hours!
We always want to talk with you. If you feel you know someone who would enjoy this video please feel free to send them the link.
As always stay happy, safe, and healthy and hopefully we will see you very soon.