Weekly Market Review May 31, 2023

President Joe Biden and House Speaker Kevin McCarthy signed off on a deal Sunday to suspend the $31.4 trillion debt ceiling until January 1, 2025, avoiding a potential U.S. debt default and pushing the next debt ceiling negotiations beyond the 2024 election cycle. The key victory for Republicans in the negotiations are spending caps on non-defense discretionary spending. (Source: The Wall Street Journal)

Here are the other details of the debt ceiling agreement which heads to Congress to be passed in the upcoming days: a 3% increase to defense spending, $80 billion in new IRS funding to better enforce the U.S. tax code, and a clawback of $50-$70 billion in unused Covid relief funds. Additionally, the Republicans were able to include new work requirements for low-income individuals receiving food assistance. On the student loan front, Republicans secured an end to the pause in student loan repayments but did not strike down the Biden Administration's $430 billion student loan forgiveness program, which the Supreme Court is currently reviewing. (Source: CNBC)

April inflation rose 4.7% compared to one year earlier according to the Fed's preferred measure of inflation, core PCE, which excludes volatile energy and food prices. While only a marginal increase from March's 4.6% reading, the highly expected June pause in Federal Reserve interest rate hikes is being called into question; the probability of another 0.25% rate hike in June rose from under 30% to over 55% after the inflation report was released. (Source: The Wall Street Journal, CME FedWatch Tool)

Blueprint Numbers 

MEMORIAL DAY HISTORY - Originally called Decoration Day, Memorial Day was declared a national holiday in 1971 to honor all 1.3 million soldiers who have lost their lives during service. The holiday has roots dating back to the Civil War, and in fact only honored fallen Civil War soldiers until World War I where it was broadened to honor all fallen U.S. soldiers throughout history. (Source: USA Today)

RARE NBA FINALS - The Miami Heat defeated the Boston Celtics in game 7 of the Eastern Conference finals, preventing a historic collapse after leading the series 3-0 out of the gate. The Miami Heat become the first eighth seed in 24 years to make the NBA Finals. The Heat will face off against the Denver Nuggets, who are making their first NBA Finals appearance as a franchise. (Source: ESPN)

THE $1 TRILLION CLUB - NVIDIA stock price is up 167% in 2023 after rallying 24% on Thursday on news of skyrocketing global demand for their graphic chips, GPUs, which are necessary to operate artificial intelligence (AI) tools. NVIDIA is now the 5th largest company in the S&P 500 Index and closing in on the rare $1 trillion market cap club of Apple, Microsoft, Alphabet, and Amazon. (Source: The Wall Street Journal)

TICKETMASTER DOMINANCE - Ticketmaster, the often-criticized live event ticketing giant, continues to dominate the ticketing marketplace despite decades of public criticism. Ticketmaster has controlled 80% of the market for primary ticketing since 1995, the initial sale of a live event ticket, and controls 70% of the entire ticketing marketplace. (Source: The Verge)

The opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. 

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