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Market Pulse

April 2023: The Market Is Chasing It’s Tail

For the month of March, the S&P 500 and Nasdaq gained 3.51% and 6.69% respectively, while the Dow trailed with an advance of 1.89%. For the quarter, the S&P 500 was up 7.03%, the Nasdaq popped 16.77%, and the Dow squeaked out a gain of 0.38%.

The good news is that the tech-heavy Nasdaq just turned in its best quarter since 2020 and the S&P 500 has just recorded two successive positive quarters, a trend that over the past 50 years has not been seen in a bear market. Good historical news but a closer look suggests we may not be in a full-blown bull market just yet.

A sizeable portion of those strong first quarter gains were driven by a narrow band of companies. Apple, Meta, Microsoft and Tesla gained 25%, 75%, 19%, and 65% respec-tively. Growth stocks, on average, shot higher but value stocks were actually negative. The end of the quarter also means a slew of corporate earnings to digest as well as a first quarter GDP report that is key to settling the debate around an impending recession.

Markets are also still digesting the worst U.S. bank failures since the financial crisis. While we see no resemblance to what took place during the financial crisis of 2008-2009, we do expect some ripple effects including increased oversight, particularly with small – mid sized banks which could hamper lending and play a role in slowing economic growth. But it would also help lower inflation and interest rates, which will in turn be a benefit to the future economy.
It’s also interesting to note that stocks have been stuck, like a dog chasing its tail for months now. The S&P 500 index traded at 4,110.41 on Sept. 12, 2022, just before aggressive Fed talk on rates and worrisome inflation data triggered a sharp sell-off. In comparison, the index finished the month of March at 4,109.31. Long story short, the S&P 500 hasn’t done much since last September.

This is not something new as U.S. stocks have remained rangebound for long stretches before. Between Jan. 1, 2015 and Nov. 9, 2016, the S&P 500 gained less than 100 points. Frankly, we feel the market has handled a lot of kicks and punches recently and it’s still standing in this range, which we feel is a sign that the market is healthy rather than ready to collapse. In other words, U.S. stocks have held up relatively well this year, despite all the drama and economic threats.

Additionally, the inflation trend looks promising as analysts expect it to get under 4% by year-end. Right now, we feel the mood on Wall Street around monetary policy is shifting to being more supportive, since the Fed is essentially signaling a pause after a May hike, and will, at least be positioned for future cuts.
Moving forward, we expect the market to remain rangebound for the next few months as we assess first-quarter corporate earnings and get a glimpse of how the overall economy is doing in terms of GDP and Job growth. We continue to favor, large-well entrenched and established names in Tech, Healthcare, and Communications and see opportunities in both fixed income and international markets.

Blackbelt In Retirement

We shouted in unison, “Black belt.”

We said it without any hesitation and didn’t even glace at each other to confirm our answers. After all, we’ve watched all the Bruce Lee and Chuck Norris movies, so this was a no brainer answer!

My two youngest kids and I had just started taking Taekwondo classes and during our first session we were asked, “Which belt is hardest to get, a white belt or black belt?”

As you may already know, a white belt is the very first belt for beginners while a black belt can take 3-5 years to achieve, if you attend class a couple times a week, consistently.

But our Taekwondo know-how fell short! Master Joe was quick to correct us say-ing, “No, the white belt is the hardest to get because you have to show up and get started to receive it. He added, “The inability to overcome the fear of beginning something new and making a commitment to change is why so many people never get a black belt in any aspect of life.”

Suddenly I felt like I was the Karate Kid talking to Mr. Miyagi. I was both in awe of the simple wisdom as well as encouraged to be starting down this new path and then Master Joe added another knowledge nugget.

“A black belt is just a piece of cloth fastened as a belt. Therefore, the ultimate goal shouldn’t be to get your black belt, but rather to be a black belt. Being a black belt is a state of mind, and a way of life.”

Whether you’re 10 or 20 years away from retirement, knocking on it’s door this year or next, or already enjoying life after work, these key elements can be applied to all of us and the various stages we are at. So let me ask you a few questions.

What would you like to start and get your white belt in?

What’s you’re current state of mind?

What daily or regular practices shape your way of life?While I don’t see myself entering any sparing competitions or setting any brisk breaking records, I am reminded of a scene from Karate kid where Mr. Miyagi said, “It’s Okay To Lose To Opponent! Must Not Lose To Fear!” A valuable reminder for anyone facing a tough new opponent or journey in their life.


  1. What is the name of the rooster on Kellogg's Corn Flakes box? Click for Answer
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