This Weekly Financial Markets Update reviews the top market headlines: Mixed Readings for the Fed’s Preferred Inflation Gauge, Consumer Sentiment Retreats, Home Price Gains Accelerate in December
  • The core Personal Consumer Expenditures price index rose 2.65% versus the prior year in January
  • The University of Michigan Consumer Sentiment Index sank to 64.7 in February
  • The S&P CoreLogic Case-Shiller 20-City Composite increased 4.5% annually in December

Top Three Market Headlines

Mixed Readings for the Fed's Preferred Inflation Gauge: The Personal Consumption Expenditures (PCE) price index, issued by the Bureau of Economic Analysis and considered the Federal Reserve's preferred inflation gauge, increased 0.33% in January from the prior month, it was reported last week. This was the fastest monthly pace for the index since March of 2024. On a "core" basis (excluding food and energy), prices rose 0.28%, up from 0.21% in December. Relative to January of last year, however, the pace of price increases cooled, with the all-items PCE rising 2.51%, down modestly from 2.60% in December, and the core PCE increasing 2.65%, down from a 2.86% pace in December.

Consumer Sentiment Retreats: The Conference Board's Consumer Confidence Index, released last week, fell seven points in February to 98.3, an eight-month low. This came on the heels of a similar drop in the Index of Consumer Sentiment, published by the University of Michigan the prior week, which declined seven points to 64.7 for February, its lowest level since November 2023. A common theme across the downcast reports was rising inflation expectations of survey respondents, related in part to rising prices for certain household staples like eggs as well as fears about tariff-induced price increases.

Home Price Gains Accelerate in December: U.S. home prices continued advancing in December, according to the S&P CoreLogic Case-Shiller Indices released last week. A composite of the 20 largest metropolitan areas rose 0.5% on the month and 4.5% compared to the prior year, both up from rates of 0.4% and 4.3%, respectively, in November. This was the second straight month the annual rate accelerated after having decelerated throughout most of 2024. Pricing trends varied across different parts of the country, however: New York led the December gains with a 1-year change of 7.2%, while Tampa saw prices fall 1.1%.

As of February 28, 2025 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World -1.30% 2.73% 2.73% 15.55%
S&P 500 -0.95% 1.44% 1.44% 19.05%
Russell 2000 -1.44% -2.87% -2.87% 7.47%
MSCI EAFE -0.81% 7.30% 7.30% 8.98%
MSCI Emerging Markets -4.31% 2.28% 2.28% 10.32%
FTSE NAREIT Equity 2.17% 4.69% 4.69% 17.22%
Bloomberg Commodity -3.74% 4.76% 4.76% 11.67%
Bloomberg U.S. Aggregate 1.26% 2.74% 2.74% 5.96%

Univ. of Michigan 2/21/25, The Conference Board 2/25/25, BEA 2/28/2025, S&P Global 2/25/2025. Data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory, named and independent fiduciary services are offered through Gallagher Fiduciary Advisors, LLC, an SEC Registered Investment Adviser. Gallagher Fiduciary Advisors, LLC does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. Gallagher Fiduciary Advisors, LLC is a single-member, limited-liability company, with Gallagher Benefit Services, Inc. as its single member. Neither Arthur J. Gallagher & Co., Gallagher Fiduciary Advisors, LLC nor their affiliates provide accounting, legal or tax advice. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your Gallagher Fiduciary Advisors consultant before acting upon any information or recommendation contained herein to discuss the suitability of the information/recommendation for your specific situation.