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March Market Analysis
Stuart Brisgel
In the past few months, disciplined and goal-focused investors have experienced rewarding times. The influence of artificial intelligence (AI) on major U.S. stock indexes has been significant, maintaining strong market sentiment throughout the extended month of February.

Overview of Major Stock Indexes
February proved to be another successful month for long-term U.S. stock investors, marking the fourth consecutive month of gains. With the Federal Reserve potentially adopting more accommodating policies, and robust earnings reports from mega-cap growth stocks, optimism remains high in the financial markets.

To break it down: the S&P 500 grew by 5.17%, the Nasdaq 100 by 5.29%, and the Dow Jones Industrial Average increased by 2.22%.

Inflation Insights
The inflation readings in February, while hotter than expected, did not dampen the bullish sentiment. The anticipation of a dovish shift by the Fed and strong corporate earnings have played pivotal roles in the market's performance.

  • Consumer Price Index (CPI) : The CPI for January rose by 0.3% month-over-month and 3.1% year-over-year, surpassing the expectations of 0.1% and 2.9%, respectively. Key contributors to this increase were shelter and food prices.
  • Producer Price Index (PPI) : Following the CPI data, the PPI for January also reported a higher-than-expected increase of 0.3% month-over-month. The core PPI, excluding food and energy, saw a significant jump of 0.5%, against a predicted 0.1%.
Labor Market and Treasury Yields
  • Employment Data : The job market showed exceptional strength with the creation of 353,000 jobs in January, far exceeding the forecast of 185,000. This robust data suggests a heated economy, potentially affecting future rate cuts.
  • Treasury Yields : February also saw a rise in government bond yields, with the 10-year Treasury Note Yield closing at approximately 4.251%, up by 28.5 basis points. This rise translated into higher mortgage rates, impacting housing affordability.

Cryptocurrency Corner: Bitcoin's Surge
The spotlight in the crypto world has been on Bitcoin, which saw an impressive 51% increase in February, boosted by the issuance of new spot ETFs. As the Bitcoin halving event approaches in April—expected to reduce the daily creation of Bitcoin by 50%—the scarcity principle is at play, driving up prices further.

Summing Up
Despite the challenges posed by inflation, the equity markets remained resilient in February, with the major indexes hitting new highs on March 1st. This continues to affirm the advantages of long-term investment strategies.

For B1 Financial, understanding these dynamics and maintaining a forward-thinking approach is key to navigating the complexities of the markets. We are here to assist with any inquiries about your investment portfolio, so feel free to reach out for personalized advice.
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