After spending a handful of days in Florida with my family for spring break (our first since 2018), I hoped to write that market performance was much better this week so I could go on vacation more often. Unfortunately, that didn’t pan out, as the market struggled after a strong day on Monday. Anyhow, with the volatile start to the year, high uncertainty, and deteriorating consumer confidence, there are quite a few interesting statistics we’ve come across over the last few weeks. Here are some of the best:
Debts Piling Up. The February Survey of Consumer Expectations from the NY Fed found that 14.6% of consumers expected to miss a debt payment in the next three months. That represents the highest monthly reading since the height of Covid in April 2020. (Source: NY Fed)
Lower Refunds. Through 2/14, the IRS received 33.0 million tax returns; the average refund for these filings was $2,169. Over the same period in 2024, the agency received 34.7 million returns; the average refund was $3,207. (Source: Internal Revenue Service)
Valuation Relief. The S&P 500’s trailing 12-month P/E ratio saw its biggest nine trading-day drop in three years when it fell three full points from 27.7 down to 24.7 from 2/19 to 3/4. At 24.7, the S&P’s P/E remains more than four points above its long-term average of 20.2 since 1990. (Source: Bloomberg)
A Bad Three Weeks. From its close on 2/19 to 3/12, the S&P 500 declined 8.6%. That ranks below the 2nd percentile of all 15-trading day moves since 1953. In prior periods when three-week returns were in the bottom two percentiles of historical returns, the S&P 500’s median 12-month gain was 20.6%, with positive returns 83% of the time. (Source: Bespoke)
Intraday Collapse. The tech-heavy Nasdaq 100 has seen heavy intraday selling since it peaked on 2/19. From 2/20 to 3/13, the index saw at least one intraday drop of at least 1% on all sixteen trading days. (Source: Bespoke)
A Mega Drawdown. From the stock market’s recent high on 2/19 through the close on 3/11, the seven largest stocks in the S&P 500 were down an average of 16.4% versus a drop of 9.3% for the index itself and just -5.6% for the 493 other stocks in the index. (Source: Bespoke)
Bears Are Everywhere. The weekly American Association of Individual Investors (AAII) poll showed that bearish sentiment increased to 59.2%, marking the third straight week of 55%+ readings. The only other time since 1987 that bearish sentiment was above 55% for as long was the three weeks ending 3/4/09. (Source: AAII, Bespoke)
Recession? What Recession? U.S. companies don’t have a recession on their radar. In a search of conference call transcripts of S&P 500 companies from 12/15 through 3/6, the term ‘recession’ was mentioned just 13 times, which was the lowest since Q1 2018 and below the 10-year average of 60. (Source: FactSet)
Four for Four. Consumer and Producer Price Indices for February were weaker than expected at the headline and core (ex-food and energy) levels. It was the first time all four inflation readings were weaker than expected in 9 months and the 19th since 2000. (Source: Bespoke)
Spring Forward. Daylight Savings Time (DST) started on 3/9. While DST was originally intended to decrease the need for evening lighting and save electricity, an NBER study found that DST results in a 1% increase in overall electricity demand due to increased demand for heating and cooling. (Source: NBER)
Markets / Economy
- Equity markets resumed their downward slide this week as the S&P was down -1.5%, the Nasdaq was down -2.6%, and the small-cap Russell 2000 was down -1.6%.
- Core PCE prices in the U.S. rose by 0.4% MoM in February, the most significant increase since January 2024. Core PCE increased to 2.8% annually, above market expectations of 2.7%.
- U.S. personal income rose by 0.8% MoM in February, the most in over a year, picking up from the revised 0.7% increase in January and well above market expectations of a 0.4% increase.
Stocks
- U.S. equities were in negative territory. Technology and Communication Services led the decline, while Consumer Staples and Energy outperformed. Value stocks led growth stocks, and small caps beat large caps.
- International equities closed lower for the week. Developed markets fared better than emerging markets.
Bonds
- The 10-year Treasury bond yield was flat for the week staying at 4.26% during the week.
- U.S. bond markets were in negative territory this week, while International bond markets were positive.
- Government bonds led for the week, followed by corporate bonds and high-yield bonds.
