Stocks Soar to Record Highs

May 17, 2024

Here are the economic and market highlights for the week: 

  • The April Consumer Price Index (CPI) rose 3.40% year-over-year (YOY), down from March’s 3.50% rise. Month-to-month, prices increased 0.30%. Core CPI, which excludes volatile food and energy, rose 3.60% YOY – its lowest pace since April 2021 – and down from the prior month’s 3.80%. Month-to-month, core prices were up 0.30% which was consistent with the YOY pace. Despite April’s slower price growth, core CPI remains above the Fed’s 2.00% target level as shelter and core services prices have continued to fuel inflationary pressures. Shelter and services (excluding energy) each increased 0.40% on the month and on a YOY basis, shelter and services (excluding energy) were up 5.50% and 5.30%, respectively.

  • The Producer Price Index (PPI), a measure of what producers receive for the goods they produce, increased 0.50% in April. The core PPI also rose 0.50% month-to-month. Services price growth remained the primary sticking point, boosting the overall wholesale inflation reading. Services prices climbed 0.60% on the month, accounting for about three-quarters of the headline increase.

  • Retail sales flatlined in April as consumers felt the sting of inflation. Sales were unchanged for the month, down from a 0.60% increase in March. The previous month’s gain was fueled in part by an early Easter holiday. Excluding the drag from autos, April’s sales would have risen 0.20%. A drop in online receipts, sporting goods and related stores, and motor vehicles and parts dealers more than offset the higher sales observed at gasoline stations (boosted by higher prices at the pump) and electronics and appliances.

    Stocks Soar to Record Highs

    It was a sneakily strong week for markets. The Dow Jones Industrial Average cracked the 40,000 level on Thursday for the first time in the benchmark’s history. The index followed the move by closing above that level on Friday for its 19th record close of the year. The S&P 500 and Nasdaq Composite also set new all-time highs, their 24th and 8th, respectively, of the year. Softer than expected CPI and retail sales numbers provided optimism that inflationary pressures are beginning to ease, and demand is softening. In turn, this could provide the Federal Reserve an opportunity to cut rates by year end provided the disinflation trend continues to hold. As of Friday, futures traders were pricing in a 67% chance of a September rate cut. That’s a sharp swing in sentiment relative to the odds investors had placed following the Fed’s meeting just two weeks ago when consensus had formed that there may be no cuts at all this year.

    While bulls re-hitched their carts to the soft-landing scenario this week, the data itself is not nearly as persuasive as the market’s reaction might otherwise have implied. Several Fed speakers, including Fed Chair Jerome Powell, continued to reiterate their call for maintaining rates higher for longer at their various speaking engagements this week, noting that disinflation is occurring more slowly than expected. This week’s data was applauded for showing a minor downtick in prices at the consumer level, but wholesale prices, that remain quite firm, were ignored. Services inflation, in particular, remains above 5%, which we could see go higher during the busy summer travel season. As far as this week’s trading was concerned, however, April’s CPI report was important because it was the year’s first disinflationary reading following three months of accelerating price growth. While the report didn’t assure a rate cut anytime in the immediate future, it managed to validate the Fed’s decision to hold off on additional hikes, providing investors with the relief they needed to resume buying and propel markets to new highs. 


The Week Ahead

The year is flying by with the Memorial Day weekend upon us. Week in Review will pause from covering the market’s record setting run. Our next edition arrives on May 31st with the latest personal income and spending and housing data.

Protecting Minors from Identity Theft

Just like adults, kids can be the target of identity thieves.  According to Javelin Strategy & Research, approximately 1.25 million kids are affected by identify theft which is about one in 50 children in America.  Child identity fraud costs U.S. families nearly $1 billion annually. In addition to the financial costs, it takes many, often stressful, hours for parents and guardians to resolve fraud related to their children’s personal information.

The Federal Trade Commission (FTC), the U.S. agency that protects consumers, explains that child identity theft occurs when someone takes a child’s personal information, such as a Social Security Number (SSN), name and address, and date of birth, and uses it to create fake identities, open a bank or credit card account, apply for loans, get utilities, or get medical care or government benefits. In many cases, the fraud is perpetrated by someone known to the child, such as a family member.  It is estimated that more than half (60%) of identity theft of a minor is perpetrated by a parent, stepparent, or other relative or family friend. The theft is unlikely to be reported in many of these cases so the instances of child identity theft are believed to be grossly understated.

Few parents have a reason to check if their child has a credit report. Children aren’t filing taxes, taking out loans, paying bills, or opening accounts that require credit checks. These are the types of activities that often flag identity theft and fraud, so it can be years before identity theft is discovered. The clean credit history of children combined with the likelihood that a child’s credit history is rarely checked make minors attractive and lucrative to identity thieves. Thieves may obtain a child’s SSN and other personal information through school forms, tax forms, medical forms, or anywhere the information is stored, including online, such as scouring social media platforms, searching through data breaches, checking public records, purchasing information from the dark web, or engaging with a child through online forums. Parents are advised to be incredibly cautious about sharing their child’s SSN and to teach children not to share personal information online. Additionally, parents should always inquire whether their child’s SSN is needed and how it will be used, how it will be stored and for how long, and how it will be thrown away. Oftentimes, a child’s SSN is requested but not needed, such as for sports team forms or other activities.

To protect their children, parents can freeze a child’s credit file. A credit freeze restricts anyone, including a parent or guardian, from opening new credit accounts with the child’s Social Security number.  Parents can also set up fraud alerts, which send notices to potential creditors, requiring them to take extra steps to verify a person’s identity before allowing anyone to open a line of credit in their name.  Documents with personal information, including SSNs, should be kept confidential and in a secure location, such as a lock box at home. Additional resources about identity theft prevention are available from the FTC online at

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