UPDATE

🌤️ Happy Tuesday

Good morning, it’s the first week of March. It’s crazy to think that spring break is just around the corner for some and that we’re moving into warmer weather after an unusually cold winter.

We wish you the best as you keep pushing toward your goals this year, and we hope after reading this week’s issue, you have a productive work day! 

Read time: 2 minutes

WEEK IN REVIEW

📈 Market Performance

Dow Jones Industrial Average (1-month), via Google Finance

We generally cover the S&P 500 in our market performance section because the index’s performance can be a good predictor of the economic situation in the United States. Millions of Americans interact with the products and services offered by the 500 largest U.S. companies, some of which are McDonald’s, Apple, and pharmaceutical giant, AbbVie. 

• As such, changes in the spending habits of a high percentage of Americans (as is the case during a recession) can hit these companies hard and, subsequently, will be reflected in the S&P. 

This week, however, we want to hone in on a different index, which seeks to provide a more focused view of the U.S. economy. 

Amazon Prime by Stock Catalog, via Flickr

The Dow Jones Industrial Average, or the Dow for short, is a measure of 30 large-cap American companies. The index is calculated by weighting each company based on its stock price, with higher-priced stocks having more weight in the index's value.

• This is in contrast to the S&P 500 index, which automatically selects the largest 500 companies and weighs them based on market capitalization.

Last week, the Dow Jones Industrial Average received a significant update—Amazon was added to the index, with the stock representing 2.93% based on its value. As a result, Amazon now joins other giants like Coca-Cola, Nike, and JP Morgan Chase, which are also a part of the S&P index.

• However, it's important to note that because the Dow only lists 30 companies, it's less diverse than the S&P. This is why investors don't usually consider the Dow as robust of a market-tracking index.

ENERGY & COMMODITIES

🥛 February Milk Index Update

MARK IT. Whole Milk Index, via MARK IT. using USDA data

With February in the rearview mirror, we now have access to the USDA's retail milk price data. Since January, the average price of a gallon of whole milk rose 3 cents, from $4.33 to $4.36.

• Remember, this price is a simple average taken from a cross-section of US cities. Among the list are cities like Boston, Detroit, Dallas, and Sacramento.

Since these are generally larger cities, this data is helpful to contextualize what a sizable percentage of Americans can expect to pay at retailers (with the caveat of a 1-month reporting delay). The data can also show us specific city data.

• St. Louis, MO, for example, saw the average gallon of whole milk cost $4.20 in January. Now, it's $4.80. That's about a 14% higher cost of milk that residents can expect to pay.

⛽️ Where Do We Stand With Gas Prices?

Gas prices have continued to rise throughout the remainder of February, and per the AAA gas prices tracker, we’re seeing a national average of $3.352. 

• Two weeks ago, in our issue The Cautious Investor, we talked about how prices are fully expected to rise in the weeks leading up to warmer months, due to chemical alterations that must occur during refinement. 

This price increase of around 2.3% percent since our last reporting falls within that expectation, but these price increases coupled with the aforementioned milk prices, and long-running inflation, can collectively put a huge pressure on working Americans.

P.S. The Bureau of Labor Statistics (BLS) is releasing February 2024 inflation data on March 14. Visit the website here to find the information once posted, and expect a breakdown by our team. 

ONE MORE THING

🤝 Keep in Touch

• For general announcements or updates on what we're working on, follow Abbas on Twitter 👉 @RealAbbasAkhtar

• Also, we want to hear your feedback! Send any comments or suggestions to [email protected]

Thanks again for reading!

Nothing MARK IT. publishes constitutes professional and/or financial advice, nor does any information published by MARK IT. constitute a comprehensive or complete statement of the matters discussed.