The Pulse on the Economy and Capital Markets: April 2024

To Summarize: The stock and bond markets forecast a better view of the economy due to a strong performance in equities and oil. For the first time in 16 months, the manufacturing sector is showing growth. Despite healthy balance sheets, small businesses remain concerned about the economy, and the price for cocoa soars presenting issues for restaurants, bakeries, and grocery stores. We unpack this and more in the April edition of The Pulse.

In the Markets: Investors are betting on continued growth and an economy that avoids a recession thanks to positive economic data and a favorable performance from the stock and bond markets. ISM Manufacturing data shows growth in the sector for the first time in 16 months. New orders are growing as inventories start to shrink, a positive leading indicator implying future growth for the sector.

Small Businesses Remain Concerned: Despite reportedly healthy balance sheets, small businesses are not expressing the same level of optimism about the economy that we see with the bond market. Yet if the Federal Reserve begins to cut interest rates, it’s likely that small businesses will become more optimistic leading to expansion and job growth. 

Whoa Cocoa: Soaring chocolate prices was not something we were chewing on coming into this month; however, the price of cocoa beans has quadrupled to nearly $10,000 per ton due to poor harvests in West Africa. Chocolate is a key ingredient in many high margin desserts and baked goods, and this shortage may have a significant impact on small businesses, such as restaurants, bakeries, and confectionaries.

Top Headlines: We’re reading about a societal shift toward women’s sports with the Iowa-LSU women’s college basketball game shattering TV rating records, the MGM hack that brought chaos to Las Vegas, the cities with the largest growth of millionaires over the next decade, and cocoa prices soar to record levels.

Related resources:

• Iowa-LSU sets women’s NCAA hoops ratings record with 12.3M viewers
• The Audacious MGM Hack that Brought Chaos to Las Vegas
• Tampa projected to add millionaires over the next decade
• Cocoa prices are soaring to record levels. What it means for consumers and why ‘the worse is still yet to come’