🎈 Rate cuts

and stocks on a high

Good morning investors! March was another great day for investors and we’re now excited to see what April holds for us.

Fun fact: (or not so fun) 95% of people lose money trading. Don’t be one of them. Counterintuitively, doing nothing is often the best option.

Today we cover:

  • Delayed rate cuts?

  • Stocks continue to go up.

  • Why invest in index funds.

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🔈 Audio version: Apple Podcasts | Spotify |

📊 Economy and News 

No rate cut in June?

“We don’t need to be in a hurry to cut,” said Fed Chair Jerome Powell signaling The Federal Reserve is ready to disregard Wall Street's desire for a rate cut in June if it believes the economy is not yet prepared.

The Personal Consumption Expenditures price index was released on the same day and came up slighly higher than the Fed’s target of 2%. It ticked up last month to 2.5% on an annual basis.

The number did not worry the Fed and Powell called it “pretty much in line with expectations.”

It seems April may prove to be another great month as stock futures are rising to start the month.

Global hits:

📈 Stocks

S&P 500 5,254.35 (+0.11%)
DJIA 39,807.37 (+0.12%)
NASDAQ 18,254.69 (-0.19%)
BRENT CRUDE 87.44 (+1.86%)
* Prices as of Apr 1st, 12:20 AM UTC

Major indexes had their fifth consecutive winning month

March has ended on a great note, being the fifth month in a row that major indexes jumped.

The S&P 500 hit 22 new highs in just the first three months of 2024, while the Dow is on the verge of surpassing 40,000 for the first time in history.

This has proven to be the S&P’s strongest first quarter since 2019. The Index has jumped 10.2% during the quarter. On the other hand, The Nasdaq has gained more than 9% during the same period.

AI craze is one of the main driving factors with names like Meta and Nvidia enjoying great gains. The chipmaker has surged more than 80% during the first three months of the year. However, some other big names such as Boeing and Tesla are having a bad 2024.

A major reason why stocks are running high is the high chances of rate cuts, something investors have been betting on for a while. About 64% of investors believe that a rate cut will occur in June, which some say will help stocks even more.

Not so green for Wallgreens: Walgreens reported fiscal second-quarter sales that beat Wall Street’s expectations. However, like most retailers, its guidance isn’t very positive.

The retail pharmacy giant reduced the upper end of its fiscal 2024 adjusted profit forecast, citing a "challenging" retail landscape in the U.S. Additionally, the company reported a significant net loss for the quarter, mainly due to a nearly $6 billion charge linked to the depreciation of its investment in primary-care provider VillageMD.

Reminder: Home Depot is acquiring specialty distributor SRS for $18.25 billion in huge bet on growing pro sales.

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💵 Personal Finance

Benefits of investing in index funds

Index funds are a type of mutual fund or exchange-traded fund (ETF) that tracks a specific market index. This means that the fund's performance is designed to mirror the performance of the index it tracks.

Here are some of the benefits to investing in index funds:

  • Low fees. Index funds typically have very low fees, which means that more of your money goes towards investing and less goes towards paying fees.

  • Diversification. Index funds are diversified, which means that they hold a wide variety of assets. This helps to reduce your risk, as you are not putting all of your eggs in one basket.

  • Passive management. Index funds are passively managed, which means that they do not try to beat the market. This makes them a good choice for investors who do not want to spend a lot of time managing their investments.

  • Long-term performance. Index funds have historically outperformed actively managed funds over the long term. This is because index funds are designed to track the market, which has historically trended upwards.

  • Tax efficiency. Index funds tend to be more tax-efficient than actively managed funds. This is because they do not make as many trades, which can lead to capital gains distributions.

  • Ease of use. Index funds are easy to buy and sell, and they can be purchased through most brokerage firms.

  • Transparency. Index funds are transparent, which means that you can easily see what assets they hold and how they are performing.

Here’s more on index funds:

💰 Be a Better Investor

"In the short run, the market is a voting machine but in the long run, it is a weighing machine."

Benjamin Graham

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