The Dividend Cafe - The Dividend Cafe Thursday - June 13, 2024

Episode Date: June 13, 2024

Market Update and Economic Indicators: A Snapshot Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividend Cafe, weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Welcome to Dividend Cafe. It is Thursday, June the 13th, and I'm here with you from the greatest city on earth in New York City, where I'll be for several days for client meetings and such. earth in New York City, where I'll be for several days for client meetings and such. But kind of a mixed day in markets, generally positive. The Dow actually closed lower by about 88 points, but that was at the highs of the session, more or less. We were down almost 300 at one point earlier in the session. But both the NASDAQ and the S&P closed in modest territory, positive territory. So generally positive. But the bigger move, I guess, on the day was more in bond land, where you had the 10-year yield drop about 14 basis points down to 425 on 10s. And so this move lower in bond yields and rates is because of a few

things. Yesterday's CPI number was weaker than expected, which is a good thing. Inflation's moving lower. And then today we had wholesale prices at the producer price index level actually deflate for the month of May. So we were down negative 0.2% for May and that was expected a 0.1% increase. And so that's quite a bit weaker on the PPI number. Core PPI was at 0% and we were expecting 0.2%. So these are good signs on inflation. It's moving in the right direction. That puts year over year PPI at 2.2% and it puts core at 3.2%. So both lower than expected. I'll call that good news on the day. Initial jobless claims were actually weaker than expected. We had a 242 print and we were expecting 225. So cooling inflation more than expected and now a weakening labor market is why you're getting

those interest rates to move lower in markets. Again, even though the FOMC meeting ended yesterday and they talked about higher for longer and their dot plots increased a little bit, the data that we're now getting real time is more indicative of tightening cycle actually taking its effect at this point and slowing things down a little bit, both of inflation and employment. Question that came in actually earlier today that I answered right away was about converting an RMD from an IRA into a Roth IRA. That's something that you could do.

And there's logic to why the question was asked. One's pre-tax, one's post-tax. The IRS doesn't allow it though, unfortunately. They want you to do your RMD that's required from the IRA. And if you want to convert some or all of your IRA balance to the Roth after that is satisfied, you can, but that's usually not what people are after. So there's your answer there. Tomorrow we'll have the longer form dividend cafe in your inbox. And we'll also have some import price index numbers to go through with you. So with that, I'm going to let you go and get back to your evening. And I'll get back to my meetings here in the city.

And I wish you well. I hope to hear from you soon with questions. Please reach out. Thank you. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, with Hightower Advisors LLC, a registered investment advisor with the SEC. Thank you. you're in. The data and information are provided as of the date referenced. Such data and information are subject to change without notice. This document was created for informational purposes only. The opinions expressed are solely those of the Bonson Group and do not represent those of Hightower Advisors LLC or any of its affiliates. Hightower Advisors do not provide tax or legal advice. This material was not intended or written to be used or presented to any entity as tax

advice or tax information. Tax laws vary based on the client's individual circumstances and can change at any time without notice. Clients are urged to consult their tax or legal advisor for any related questions.