Stocks closed mixed ahead of the release of more economic data. Matthew Johnson, president of Johnson Wealth & Income Management, joined Cheddar News to also weigh in on last week's jobs data and the status of the country's labor market and what that could mean for another Fed decision.

Stocks closed mixed ahead of the release of more economic data. Matthew Johnson, president of Johnson Wealth &amp; Income Management, joined Cheddar News to also weigh in on last week's jobs data and the status of the country's labor market and what that could mean for another Fed decision.

Closing Bell

What to Expect in the Market Ahead of This Week's Economic Data

I'm joined by Matthew Johnson, he's president of Johnson Wealth and sorry Johnson Wealth and Income Management, which is a financial services forum. So, Matt, thanks so much for joining me. What do you make of today's recent market action? Hey, thank you for having me on today, Michelle. Well, I think that there's a lot of subdued within the market today. You know, everybody's waiting for the data that's going to be coming out. We've got a lot of information, we got corporate profits that are going to be coming out corporate numbers. We know that we're going to see AC P I print later this week. And so a lot of people are just kind of holding their breath trying to figure out, ok, what's going to be the next move or are we going to see inflation drop by as much as we anticipate? Is it going to be higher? Are we going to see the feds go for one more rate increase? Is it potentially going to be two? So I think that we've just got a little bit of subdued that's going on in the market and that's the reason we saw the market turn out the way that it did today. Now, let's talk about Friday's March jobs report, the market was closed for Good Friday, but it did show that the country added about 236,000 jobs last month. Wall Street could finally react today. What are you understanding from the reaction at this point? Well, I think in many respects it is showing signs of strength, but it's also showing signs of weakness on average over the last six months, Michelle, we've seen our country add about 330,000 plus jobs per month. This one came in about 100,000 less. And so we're starting to see some weakness in that. Now, we have to remember that the Federal Reserve came out last year and said, you know what, it would not be too much to ask for 4.5% unemployment. And we're starting to see wage and job growth start to decrease and starting to soften a little bit, which indicates that what they're doing and raising interest rates and trying to slow the economy is actually working. Things are starting to come down. But at the same time, I have to give credit where credit is due. This economy continues to stay very, very strong. We had unemployment at 3.5%. So people are employed, but we're starting to see those numbers shrink a little bit. Speaking of those numbers shrinking and 100,000 less jobs in the month before. Do you think this tight labor market means we might see yet another rate hike next month? I think that we can bank on that. The Federal Reserve is staying extremely dedicated to their job of bringing inflation down. Remember that their goal is 2.5 2%. I think that that's very audacious, but even in light of the banking crisis that we had recently, you saw that they continued to press forward with that 25 basis point rate increase. And I believe that we're going to see another one, it's going to happen. I would even set my own clients expectations that listen, they're very, very data driven. So it would not surprise me if they tack on even an extra beyond that. And I'm not saying it's going to happen, but we have to be prepared for just about anything in this market. I'm glad you brought up a Silicon Valley bank and credit Suisse and those recent bank failures. Do you think we've seen the full effects of those yet? I really don't. I think that we're past the initial shock and the initial knee jerk reaction and seeing a couple of major banks fail as the information has come out. A lot of it was irresponsibility on the part of the managers of the bank. Of course, the Federal Reserve raising interest rates hasn't really helped and we know if they raise rates some more, it's not going to help. But I think by and large, more and more Americans are understanding that the risk is quite very, very small at this point. And I do not see that we're going to have a banking crisis. I don't believe it's going to happen. I think that this was something that was very individualized, primarily because of the type of bank that they were dealing with. One that's specializing in tech. You got another one that's specializing in crypto. No doubt this is a tough industry, a tough environment for the banks and we've got a lot of money that's shifting back and forth from institution to institution because people are trying to get better interest rates and the money who blames them. But I think we are not going to be seeing a crisis anytime real soon. We're seeing shares and mixed today. The market is a little bit volatile. So how should investors position their portfolios? Well, really the question is, what stage of life are, are they in? You know, if you're still in the accumulation stage of life, then use the volatility to your advantage be taking and, and dabbling in dollar cost averaging and buying more of these quality companies. But we have to stay extremely focused if you're on the distribution stage of life. Remember in a year, Michelle, we're going to be having uh around 12,000 people a day turning age 65 the baby boomer generation, they are here and they're retiring. And so if we're preparing for that retirement and we've got money in the market, we need to be extremely careful because we're embarking on the distribution stage of life. So I want to remain very vigilant on quality. I want to be looking for free cash flow companies and I want to be focused on dividends. And if I have dividends in my portfolio, that means that I have income or that means that I can reinvest those dividends back into more stock. Well, thanks so much for joining us today. That's Matthew Johnson, he's president at Johnson Wealth and Income Management, which is a financial services firm.