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Weekly Economic and Stock Market Commentary – January 23, 2023

Weekly Economic and Stock Market Commentary – January 23, 2023

Weekly Economic and Stock Market Commentary - January 23, 2023

As for the stock market specifically: Two of the averages in the header table were responsible for much of the gains last week. The technology-laden Nasdaq Composite had a good week, and international markets continued to lead the way in terms of strength.

It is way too early to say the year will go like this or that, but so far we seem to be witnessing a change in market leadership.

The bullish percent research indicators had a very strong week. That speaks to the one-stock/one-vote nature of composition. We find ourselves in WEALTH ACCUMULATION mode, near midfield.

Remember, X’s mean OFFENSE or wealth accumulation, while O’s mean DEFENSE, or wealth preservation.

Below is where our indicators stand as of January 20, 2023 (Courtesy Dorsey, Wright, and Associates).

Economic and Stock Market Commentary

On a general note: The Department of Commerce announced its December retail sales figures. Sales fell 1.1% during the month compared with November 2022. More ominously, the November number saw a downward revision, and sales fell in three of the prior 4 months.

The National Association of Realtors announced December existing home sales declined 1.5% in December 2022 to a seasonally adjusted annualized rate of 4.02 million homes. This is compared to November 2022. When compared to December 2021, the drop measured 34%. That marked the 11th consecutive month of declines, which is a record.

Overall, 2022 existing home sales were 17.8% lower in 2022 compared to 2021. The sales rate in 2022 was 5.08 million homes. The median December sales price was $366,000, which is a gain of 2.3% from December 2021. December was the sixth consecutive month in which the average resale price fell.

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