Stocks notched a solid gain as dovish comments from Federal Reserve officials boosted the market’s recovery from early August lows.

The Standard & Poor’s 500 Index rose 1.45 percent, while the Nasdaq Composite added 1.40 percent. The Dow Jones Industrial Average picked up 1.27 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, gained 2.98 percent.^1,2

Dovish Week

Stocks started the week strong, rallying after Wall Street welcomed dovish comments from Minneapolis Fed President Neel Kashkari. The S&P 500 and Nasdaq each posted gains on Monday–the 8th consecutive winning session. The Dow rose for the 5th session in a row.^3,4

From there, markets traded in a narrow band until Wednesday afternoon when minutes released from the July 30-31 FOMC Meeting revealed more dovish comments. On Thursday, stocks dipped ahead of Fed Chair Jerome Powell’s annual Jackson Hole, Wyoming, speech.^5,6

Well-received comments from Powell on Friday boosted markets, with all three averages closing higher.⁷

“The Time has Come”

The Fed’s annual symposium for global central bankers started Friday morning with Fed Chair Powell’s much-anticipated speech. Citing the risk of the labor market cooling even further, he said, “the time has come for policy to adjust.” 

Investors responded favorably, with the remaining question being how significant a rate cut might be. Powell kept that door open, adding that “the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”⁸

This Week: Key Economic Data

Monday: Durable Goods.

Tuesday:  Consumer Confidence. Case-Shiller Home Price Index.

Wednesday: Fed Official Raphael Bostic speaks.

Thursday: GDP. International Trade in Goods. Jobless Claims. Pending Home Sales.

Friday: Personal Income and Outlays. Consumer Sentiment.

^{Source: Investors Business Daily – Econoday economic calendar; August 23, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Wednesday: NVIDIA Corporation (NVDA), Salesforce Inc. (CRM)

Thursday: Dell Technologies Inc. (DELL)

^{Source: Zacks, August 23, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“In a gentle way, you can shake the world.”

– Mahatma Gandhi

Gig Economy Tax Tips

There are some essential tips to remember if you work as a gig worker, someone who takes temporary work through one or more employers:

• All income from these sources is taxable, regardless of whether you receive information returns; this includes both full-time and part-time work and if you’re paid in cash.

• As a gig worker, you must be correctly classified as an employee or an independent contractor; this can depend on where you live, even for the same services.

Lastly, it’s important to remember to pay the correct amount of taxes on this income throughout the years to avoid owing when you file. Because gig employees don’t have an employer withholding taxes from their paychecks, they can either submit a new W-4 and have their employer withhold more from their paycheck (if they have another job as an employee) or make quarterly estimated tax payments throughout the year.

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁹

Boost Your Productivity With These Tips

Take regular breaks. It seems counterintuitive, but most people are more productive when they take regular breaks. 

Do the challenging tasks first. Mark Twain famously said to “eat the frog first thing in the morning,” meaning you should tackle your most difficult task immediately. 

Make two to-do lists. One that has your weekly goals and objectives and one that has your daily tasks. 

Divide large projects into manageable steps. Make the things on your to-do list specific so you can continue to cross things out and make progress.

Tip adapted from Formstack¹⁰

Anna, a supermarket clerk, has not slept during any of the past six nights, yet she is not tired. How can this be?

Last week’s riddle: It stands higher than any tree, yet it seemingly takes forever to grow, and you can’t see its roots. You won’t have to shimmy up any trunk to reach its top. What is it? Answer: A mountain.

Moraine Lake 

Banff National Park, Canada

Footnotes and Sources

^{1. The Wall Street Journal, August 23, 2024}

^{2. Investing.com, August 23, 2024}

^{3. The Wall Street Journal, August 23, 2024}

^{4. The Wall Street Journal, August 19, 2024}

^{5. MarketWatch.com, August 22, 2024}

^{6. Reuters.com, August 22, 2024}

^{7. The Wall Street Journal, August 23, 2024}

^{8. The Wall Street Journal, August 23, 2024}

^{9. IRS.gov, May 8. 2024}

^{10. Formstack, May 8, 2024}

Stocks posted solid gains last week, buoyed by robust economic data and constructive comments from Fed officials.

The Standard & Poor’s 500 Index rose 3.93 percent, while the Nasdaq Composite gained 5.29 percent. The Dow Jones Industrial Average lagged a bit, picking up 2.94 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, powered ahead by 4.31 percent.^1,2

Upbeat Economic News

Three critical economic data points gave investors what they were looking for: wholesale inflation, consumer prices, and retail sales.

Both the Producer Price Index and the Consumer Price Index rose less than expected in July, reinforcing a picture of cooling inflation. The July retail sales report on Thursday was stronger than expected, which added more fuel to the week-long rally.^3,4,5

Market action slowed down on the week’s final trading day, with positive consumer sentiment gains countered only by a drop in housing starts.

It was the S&P 500’s best weekly gain of the year so far and the best since November of 2023. The gains helped erase losses from earlier in the month, when “carry trades” news from Japan unsettled investors.^6,7

Double Assist

Last week’s market rally saw assists from two places: economic data and constructive Fed comments.

On Thursday, Atlanta Fed President Raphael Bostic said he had “a lot more confidence that inflation’s sustainably on its way to 2%,” citing steady drops in CPI. And St. Louis Fed President Alberto Musalem said, “the time may be nearing when an adjustment (to the Fed Funds Rate) may be appropriate.⁸

This Week: Key Economic Data

Monday: Leading Indicators.

Wednesday: FOMC Meeting Minutes.

Thursday: Jackson Hole Economic Symposium. Jobless Claims. Existing Home Sales.

Friday: Jackson Hole Economic Symposium. New Home Sales. Fed Chair Jerome Powell speaks.

^{Source: Investors Business Daily – Econoday economic calendar; August 16, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Monday: Palo Alto Networks, Inc. (PANW)

Tuesday: Lowe’s Companies, Inc. (LOW)

Wednesday: The TJX Companies, Inc. (TJX), Analog Devices, Inc. (ADI)

Thursday: Intuit Inc. (INTU)

^{Source: Zacks, August 16, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“Spread love everywhere you go. Let no one ever come to you without leaving happier.”

– Mother Teresa

Who Qualifies for the Child and Dependent Care Tax Credit?

Let’s outline who the Internal Revenue Service (IRS) defines as a qualifying person under this care credit:

• A taxpayer’s dependent who is under the age of 13 when the care is provided.
• A taxpayer’s spouse who is physically or mentally unable to care for themselves and lived with the taxpayer for more than half the year.

In addition to spouses and dependents, the credit may also cover someone who is mentally or physically unable to care for themselves and lived with the taxpayer for six months; this is the case if that person was the taxpayer’s dependent or if they would have been the taxpayer’s dependent except for one of the following:

• The qualifying person received a gross income of $4,700 or more.
• The qualifying person filed a joint return.

If filing jointly, the taxpayer or spouse could be claimed as a dependent on someone else’s return.

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁹

What Are Essential Oils?

You’ve likely heard about the many potential benefits of essential oils, but what exactly are essential oils?

Essential oils are compounds extracted from plants, obtained through distillation or cold pressing. The best essential oils are pure, with no other chemicals added. In addition to using essential oils in a diffuser as aromatherapy, you can apply them topically. Inhaling the aromas from essential oils may stimulate areas of your limbic system, which is a part of your brain that plays a role in emotions, behaviors, sense of smell, and long-term memory.

Tip adapted from Healthline¹⁰

It stands higher than any tree, yet it seemingly takes forever to grow, and you can’t see its roots. You won’t have to shimmy up any trunk to reach its top. What is it?

Last week’s riddle: There are three cups of flour on a counter and you take one away. How many cups of flour do you have now? Answer: You have one cup of flour, as you have taken one away.

Zabriskie Point in Death Valley National Park
Death Valley, California, United States

Footnotes and Sources

^{1. The Wall Street Journal, August 16, 2024}

^{2. Investing.com, August 16, 2024}

^{3. The Wall Street Journal, August 13, 2024}

^{4. The Wall Street Journal, August 14, 2024}

^{5. The Wall Street Journal, August 15, 2024}

^{6. The Wall Street Journal, August 16, 2024}

^{7. CNBC.com, August 16, 2024}

^{8. The Wall Street Journal, August 15, 2024}

^{9. IRS.gov, May 8. 2024}

^{10. Healthline, May 8, 2024}

Stocks ended last week with modest losses, masking a volatile five-day trading period that saw investors embrace recession concerns and then dismiss the slow-down talk as speculation as the week progressed. 

The Dow Jones Industrial Average slipped 0.60 percent, while the Standard & Poor’s 500 Index ended flat (-0.04 percent). The Nasdaq Composite dipped 0.18 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, fell 1.21 percent.^1,2

Stocks Stage Comeback

Monday was the worst day for the S&P 500 and the Dow in nearly two years. As recession talk grew louder, investors took a “risk off” position.

On Monday, the Japanese market had its worst drop since 1987  as market participants unwound positions from a popular trading strategy called a “carry trade” amid a global sell-off in stock prices.³

But on Thursday, initial jobless claims fell less than expected—a positive sign for the labor markets— which quieted some of the recession talk. Also, as the week progressed, there was growing speculation that the July jobs report was more of an outlier than a lead indicator of a pending recession.

By Friday’s close, all three major averages had regained most of the week’s losses.⁴

Mortgage Update

Last Thursday, the average rate on a 30-year fixed mortgage dropped to 6.47 percent—a 15-month low. Many home buyers welcomed the news, and it appeared to help support Thursday’s rally.⁵

But the announcement left some wondering whether rates would continue to trend lower. Mortgage rates are tied to the interest rates set by the Federal Reserve. Some speculated the drop was due to market participants anticipating the Fed would adjust rates in September, which remains anything but certain.⁶

This Week: Key Economic Data

Tuesday: Producer Price Index (PPI). Fed Official Raphael Bostic speaks.

Wednesday: Consumer Price Index (CPI). EIA Petroleum Status Report.

Thursday: Jobless Claims. Retail Sales. Industrial Production. Business Inventories. Fed Officials Alberto Musalem and Patrick Harker speak.

Friday: Housing Starts and Permits. Consumer Sentiment. Fed Official Austan Goolsbee speaks.

^{Source: Investors Business Daily – Econoday economic calendar; August 8, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Tuesday: The Home Depot, Inc. (HD)

Wednesday: Cisco Systems, Inc. (CSCO)

Thursday: Walmart Inc. (WMT), Applied Materials, Inc. (AMAT), Deere & Company (DE)

^{Source: Zacks, August 8, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“When things go wrong, you’ll find they usually go on getting worse for some time; but when things once start going right they often go on getting better.”

– C.S. Lewis

Divorce or Separation Can Affect Your Taxes

The first thing to consider is alimony payments. Alimony payments paid under a divorce or separation instrument are deductible by the payer, and the recipient must include it in income. Alimony is not subject to tax withholding, so increasing the tax paid during the year may be necessary to avoid a penalty.

The next thing to consider is IRA contributions. A divorce agreement by the end of the tax year means taxpayers can’t deduct contributions made to a former spouse’s traditional IRA. They can only deduct contributions made to their own traditional IRA.

Once you reach age 73, you must begin taking RMDs from a traditional IRA in most circumstances. Withdrawals from traditional IRAs are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty.

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁷

3 Yoga Poses for Beginners

The first pose is a downward-facing dog used in most yoga practices. In it, you have your arms stacked under your shoulders, your bottom in the air, and your back legs straight. Your body is in the shape of an upside-down “V.”

The next is Crescent Lunge. Stand in a forward lunge with one foot in front and bent. Your back leg is straight. Now, straighten your arms and lift them over your head. This pose is often used in yoga flow classes. 

Last, we have the Triangle pose. Step your feet apart (wider than your shoulders). Then, hinge at your hip and lean over your front leg. Reach down with the same arm in front and rest it on the floor or a yoga block.

Tip adapted from SELF Magazine⁸

There are three cups of flour on a counter and you take one away. How many cups of flour do you have now?

Last week’s riddle: A cat falls into a hole 14.5 feet deep. The cat can jump 3 feet high, but she slides back 1 foot with each jump. How many jumps does it take her to get out of the hole? Answer: Every 3-foot jump accompanied by a 1-foot slide equals jumps of 2 feet high each; at that rate, the cat’s seventh jump, starting at 12 feet, will leave her 15 feet above the bottom of the hole so that she may escape.

Hirosaki castle, Hirosaki, Japan

Footnotes and Sources

^{1. The Wall Street Journal, August 9, 2024}

^{2. Investing.com, August 9, 2024}

^{3. CNBC.com, August 5, 2024}

^{4. The Wall Street Journal, August 8, 2024}

^{5. The Wall Street Journal, August 8, 2024}

^{6. The Wall Street Journal, August 9, 2024}

^{7. IRS.gov, May 8. 2024}

^{8. SELF Magazine, May 8, 2024}

Stocks fell broadly last week as investors looked past upbeat Fed comments and focused on disappointing corporate reports and weaker-than-expected economic data.

The Dow Jones Industrial Average lost 2.20 percent, while the Standard & Poor’s 500 Index fell 2.06 percent. The Nasdaq Composite Index dropped 3.35 percent. By contrast, the MSCI EAFE Index, which tracks developed overseas stock markets, gained 0.19 percent for the week through Thursday’s close.¹ 

Volatile Week of Trading

Stocks were under pressure early in the week as investors appeared to focus on the Fed’s meeting, which ended on Wednesday. It was a big week for Q2 corporate reports, with five of the ten largest names in the S&P 500 (by market capitalization) reporting numbers. But attention was mainly on the Fed’s meeting.^2,3

Stocks rallied on Wednesday when Fed Chair Powell indicated a September interest rate cut was “on the table.”⁴

But selling picked up on Thursday as investors’ attention quickly shifted to disappointing corporate reports and weak economic data. Friday morning’s disappointing June jobs report raised even more concerns about the economy’s strength. The Nasdaq ended the week in correction territory, down more than 10 percent from its recent all-time high.^5,6

Economic Concerns

Fresh economic data suggested weakening manufacturing, construction, and employment outlooks. On Friday, the Labor Department’s July jobs report showed a sharper-than-expected job growth slowdown and an unemployment uptick to 4.3 percent—the highest rate in 2½ years.

At Wednesday’s Fed press conference, investors welcomed Powell’s unusually candid and upbeat comments. However, as the week progressed, investors started questioning whether the Fed was misreading the economy and moving too slowly in adjusting interest rates.⁷

This Week: Key Economic Data

Monday: ISM Services Index. Fed Official Mary Daly speaks.

Tuesday: International Trade in Goods and Services. Treasury buyback announcement.

Wednesday: Consumer Credit. EIA Petroleum Status Report.

Thursday: Jobless Claims. Fed Balance Sheet.

^{Source: Investors Business Daily – Econoday economic calendar;  August 2, 2024. 
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Tuesday: Amgen Inc. (AMGN), Caterpillar Inc. (CAT), Uber Technologies, Inc. (UBER), Airbnb, Inc. (ABNB)

Wednesday: The Walt Disney Company (DIS)

Thursday: Eli Lilly and Company (LLY), Gilead Sciences, Inc. (GILD)

^{Source: Zacks, August 2, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“What you do makes a difference, and you have to decide what kind of difference you want to make.”

– Jane Goodall

Is it Time for a Paycheck Checkup?

There’s no better time to check your withholding status and make sure your paycheck accurately reflects the taxes you should be paying. These paycheck checkups are a great practice when something happens in your life that may change your tax status, such as getting married or getting divorced, having a baby, getting a new job, or getting a raise or promotion at work. You can also adjust your withholding status if you want to change the tax withheld due to other circumstances.

Other factors can also be checked during your paycheck checkup, such as how much you contribute to your health insurance retirement plan. These expenses can also impact your tax liability.

*This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov⁸

5-Minute Core-Strengthening Workout

Even if you only have a little time to dedicate to a core workout, this circuit will get you going and only takes 5 minutes. Here are the moves:

• 1-minute high plank: Your hands are on the ground, your arms are straight, and you are holding your body up with your arms and a tight core.
• 30-second side plank on each side: One hand is on the ground, your arm is straight, and the other is in the air. You can do a side plank with your feet stacked on each other (most challenging), your feet staggered (a little easier), or your bottom knee on the ground.
• 1-minute boat pose: Your feet are in the air, and your arms are by your side, reaching to your feet. You can pose with your legs bent (easier) or straight out (harder).
• 1-minute crunches: Lift your shoulders and upper back off the ground without pulling your neck.
• 1-minute dead bug: Lay on your back and alternate, extending out the opposite arm and the opposite leg simultaneously.

Tip adapted from Mind Body Green Movement⁹

A cat falls into a hole 14.5 feet deep. The cat can jump 3 feet high, but she slides back 1 foot with each jump. How many jumps does it take her to get out of the hole?

Last week’s riddle: I am usually only as wide as a thumb and typically travel across the nation for less than a dollar, all while lying flat. What am I?  Answer: A postage stamp.

Botan Canyon, Siirt Province, Turkey

Footnotes and Sources

^{1. The Wall Street Journal, August 2, 2024}

^{2. The Wall Street Journal, August 2, 2024}

^{3. S&P Global, July 31, 2024}

^{4. The Wall Street Journal, July 31, 2024}

^{5. The Wall Street Journal, August 1, 2024}

^{6. CNBC.com, August 2, 2024}

^{7. The Wall Street Journal, August 2, 2024}

^{8. IRS.gov, May 8. 2024}

^{9. Mind Body Green Movement, May 8, 2024}