John Hancock: Weekly Market Recap Week Ending January 28th

Upbeat earnings

As of Friday, fourth-quarter profits at companies in the S&P 500 were expected to increase more than 24%, based on companies that have reported so far and forecasts for firms that haven’t yet released earnings, according to FactSet. That’s up from the 21% rise that had been projected at the end of December.

Fed’s rate outlook

As expected, U.S. Federal Reserve policymakers signaled that they remain on track to begin lifting short-term interest rates at their next policy meeting in mid-March. The Fed didn’t indicate how many additional increases it expects this year as it tries to prevent a further surge in currently high inflation.

Growth outlook scaled back

The International Monetary Fund lowered its forecast for global economic growth this year, citing uncertainty about the pandemic, inflation, supply disruptions, and U.S. monetary policy tightening. The IMF now projects global GDP growth of 4.4%, down a half-percentage point from its earlier forecast, mainly due to growth downgrades for the United States and China.

Jobs ahead

A monthly labor market update due out on Friday is likely to be the week’s most closely watched economic report. The new release covering January follows a report that showed the economy generated 199,000 jobs in December—far below economists’ consensus forecast—while the unemployment rate fell sharply to 3.9% and wages grew at a 4.7% annual rate.

Source: https://wmr.jhinvestments.com/