April 17, 2021 Weekly Market Update. The equity markets continued the upward trajectory for the week led by the S&P 500 Index +1.37%, followed by the Dow Jones Industrial +1.18% and the Nasdaq +1.09%. The March retail sales results handily beat expectations at +9.8% vs. estimates of +5.5% as restrictions eased and consumers benefited from stimulus checks. On the global front, the quarterly GDP growth of +18.3 reported by China was a positive surprise for the World’s economy. The U.S. Core Consumer Price Index (“CPI”) rose 0.3% on the month, a huge monthly jump for the index that excludes food and energy. This CPI inflationary gauge has a run rate of over 3% annually, which would probably place core inflation around 2%. However, despite the big jump, the 10-year Treasury yields remained around 1.6%. While many states seem to be experiencing spikes in new COVID-19 cases, this worry was offset by 38.5% of U.S. adults having now received at least one vaccination dose; 24.3% are now fully vaccinated.
April 10, 2021 Weekly Market Update. The Nasdaq reemerged as the major indices leader with a +3.12% gain, followed by the S&P 500 +2.71% and the Dow Jones Industrial +1.95% for the week. The economy added 916,000 jobs in March, the largest gain since August 2020, marking pandemic-low unemployment rate of 6%. Meanwhile the ISM non-manufacturing Index report of 63.7% blew-out estimates of 58.5% while March ISM manufacturing Index reached a 38-year high of 64.7%. Investor sentiment towards the global economy over the next 6-months has also reached a record high according to survey data covered by Sentix. However, proposed U.S. new corporate and individual tax hikes may lead to greater uncertainty and spur future market volatility.
April 3, 2021 Weekly Market Update. The S&P 500 led the major U.S. indices with +1.57% weekly return, followed by the Dow Jones Industrial +1.36% while the Nasdaq gave back -0.58%. The ongoing equity rally reflects a recovery where the term “recession” is no longer in the Wall Street vocabulary but rather “V” shape recovery; this has been spurred by unprecedented government stimulus and a very liberal Fed policy. Though the COVID-19 cases have recently spiked (5% range) in over half the U.S. states, the shift toward “business as usually” continues its incremental path toward pre-coronavirus normalcy. Indeed, over 30% of the U.S. population have now had at least one vaccination shot and some of the vaccine options appear to affective against the new variants. It should come to no surprise then that the Conference Board's consumer confidence index has now jumped to a one-year high of 109.7 from 90.4 in February.