The Dividend Cafe - The Dividend Cafe Tuesday - April 30, 2024

Episode Date: April 30, 2024

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. Hello and welcome to Dividend Cafe. This is Tuesday, April the 30th, and good to be with you here today. Actually, it was a down day in markets. The Dow closed. It was down all day, but just sort of slid lower throughout the trading day and ended up closing right at the lows.

The last basically 10, 15 minutes of the session, the selling actually picked up a little bit and we closed down 570 points, which is about one and a half percent on the Dow. And the S&P was down about the same amount as far as percentage terms go. The NASDAQ was down about 2%. So down day, close to the lows. Tomorrow, we have a conclusion of the Fed meeting. And so that's what markets are sort of selling off for in advance of what could be a hawkish tone from the Fed given inflation sort of sticking around here a little bit. So, you know, good news is that I do think they'll probably mention something about quantitative easing and slowing down some of the bond runoff a little bit.

So you may get some recovery tomorrow, but we shall see. Day-to-day is always tough to predict. All sectors were negative on the day. The health care sector was also negative, but negative by less than the others. It was just almost flat. Energy was down 2.5%, a little bit more, 2.6% on the day. We had a couple of news out, economic news. There was a Chicago PMI number that came in weaker than expected at 37.9 versus 45.

Both of those numbers, whether it came out or what was expected or below 50, so contractionary, but a little disappointment there on the PMIs in Chicago. Consumer sentiment, again, this is always sort of a backward-looking indicator for us, so we don't spend a ton of time on it, but was weaker for the third month in a row with cost of things like food and gas and what most consumers spend their money on as the main concern. Earnings, in the What's on David's Mind, we talked a little bit about earnings. I mean, the expectation for 2024 is 11% in growth in earnings from last year. It's fairly optimistic just given that Q1 was only tracking 5.6%. So that means that there's a lot of sort of excellent expectations priced into the

second half of the year. And we just feel that that might be a little overly optimistic for the rest of the year. Revenue, by the way, is not growing at the same amount. Revenue last year was only at 3.8%. So you're getting some of this with some margin expansion inside of there. Tomorrow we'll have an ADP private payroll report out. And then we'll also have another read on ISM manufacturing. And then, of course, what will end up being, I think, 2 p.m. Eastern, we'll have a conclusion to the Fed meeting. So with that, I'm going to let you go for the evening. It was lovely to be with you. As always, please go to DividendCafe.com and enter your questions there.

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