LA Wealth Advisors is thrilled to announce the successful completion of its second full quarter, now Q1 of 2024, marked by our dedication to serving our clients. As we reflect on this milestone, we take pride in the trust our clients have placed in us and the meaningful impact we’ve made on their financial journeys. Our team remains committed to providing personalized wealth management solutions, tailored to the unique needs and goals of every individual we serve. Looking ahead, we are excited by the opportunities to continue growing and evolving, always striving to exceed expectations and deliver exceptional results for our valued clients. Your opinion matters to us, and we appreciate all feedback that you provide.

As a quick update your first quarter reports are posted to your LA Wealth Client Portal, and as an update to our first quarter report below, April has seen inflation begin to cool from 3.5% to 3.4%, welcomed news for investors.

Market highlights for the first quarter of 2024

The economy continued to recover; however, inflation remained a key concern, with prices rising across various sectors, particularly energy and housing. Central banks closely monitored inflation data, balancing the need to support economic growth with the imperative to keep inflation in check.

Inflation remained a prominent concern for policymakers, businesses, and consumers alike. The period was marked by ongoing pressure on prices across various sectors of the economy, contributing to a sustained upward trend in inflationary indicators.

However, as the quarter progressed, economic data showed signs of resilience, with strong corporate earnings reports and robust consumer spending helping to buoy investor confidence. Tech stocks continued to perform well, driven by advancements in artificial intelligence, cloud computing, and other innovative technologies. Additionally, sectors like healthcare and renewable energy attracted investor interest, reflecting growing awareness of sustainability and healthcare innovation.

On the bond market front, yields initially rose in response to inflation concerns, but later stabilized as central banks indicated a cautious approach to further monetary tightening. Government bonds remained attractive as safe-haven assets amidst market uncertainty, although corporate bonds, and credit sensitive high-yield bond markets also saw demand from investors seeking higher income yields.

Central banks closely monitored inflation developments during the quarter, assessing the potential implications for monetary policy. While policymakers remained committed to supporting economic recovery, there were growing concerns about the persistence of inflationary pressures and the need to prevent inflation expectations from becoming unanchored.

Q1- 2024 inflation was influenced by various factors. Below are some of the key contributors:

• All items: The overall consumer price index rose by 3.5%
  • Food: The food index increased by 2.2%
    • This includes:
      • Food at home: 1.2%
      • Food away from home: 4.2%
  • Energy: The energy index increased by 2.1%
    • This includes:
      • Electricity: 5%
      • Unleaded regular Gasoline: 1.3%
  • All items less food and energy: This index rose by 3.8%.
    • Some notable contributors include:
      • Video discs and other media: 30.1%
      • Motor vehicle insurance: 22.2%
      • Repair of household items: 18%
      • Rent of primary residence: 5.7%All items: The overall consumer price index rose by 3.5%

Please note that these are just a few of the components. There are many other factors that contribute to inflation. The percentages represent the year-over-year price changes for March 2024.

Overall, the first quarter saw a resilient stock market, supported by strong corporate performance and economic recovery efforts, despite lingering concerns about inflation and monetary policy. Bond markets remained stable, with yields responding to shifting expectations regarding central bank actions. Investors remained cautiously optimistic, navigating a complex economic landscape characterized by both opportunities and risks.

While we anticipate we will see lower interest rates in the near future, that probability has shifted toward further into 2024.  In addition to interest rates and inflation, foreign conflicts are putting increased pressure on the global economy.  While the outcome of continued conflicts in both eastern Europe and the Middle East can create unforeseen short-term impacts on the market, we remain focused on the long-term outlook for investing. 

As an LA Wealth client you are accustomed to our ongoing planning and investing dialogue with you.  Please reach out with any questions.

–  LA Wealth Advisors