The U.S. stock market finished the week higher amid positive economic data and U.S. and China trade talk optimism.  Overall positive economic data also had interest rates move higher as the 10-year treasury yield jumped 9 basis points to 2.50%.  The spread between the 10-year treasury yield and the 2-year treasury yield also increased as it widened from 0.16% to 0.19%.  Despite better than expected economic data, the price of gold was little changed as it decreased 0.10% to $1,295.70 an ounce.  That said, the U.S. dollar index (DXY), which tends to move inversely to the price of gold, also saw little change as it increased from 97.26 to 97.41.  The price of crude oil jumped 5.20% to $63.31 a barrel as global oil output continues to slow, putting less pressure on the oversupplied resource.

Index               Started Week         Ended Week         Change         Change %         YTD %
DJIA 24,815.0425,983.941,168.904.71%11.39%
Nasdaq 7,453.157,742.10288.953.88%16.68%
S&P 500 2,752.062,873.34121.284.41%14.62%
Russell 2000 1,465.491,514.3948.903.34%12.30%

This Week’s Economic Highlights

  • Retail sales for the month of February came in weaker than expected as they dropped 0.2%, however the prior month’s retail sales were revised upward from 0.2% to 0.7%.  Excluding autos, which tend to be volatile and inconsistent from month-to-month, retail sales fell a more significant 0.4%.
  • The ISM manufacturing index recognized a slight rebound in March as it increased from 54.2% to 55.3%.  (Any reading above 50% indicates improving economic conditions.)  Meanwhile the ISM non-manufacturing index fell from its highest reading in nearly a decade of 59.7% to 56.1%.
  • Durable goods orders dropped 1.6% in February and was largely attributed to fewer bookings of aircraft and defense-related orders.  However, excluding transportation from the calculation (which includes the inconsistent and volatile aircraft and defense-related orders), durable goods orders actually rose 0.1%.
  • Initial unemployment claims fell by 10,000 to 202,000 for the week ending March 30th, marking its lowest reading since December of 1969.  Continuing unemployment claims, which lags initial claims by a week fell by 38,000 to 1.72 million.
  • The U.S. added 196,000 jobs in March after coming off a concerningly low 33,000 increase the month prior.  Despite the significant increase in jobs, the unemployment rate holds steady at 3.8% as the labor force participation rate also increased.  Wage growth, as measured by the average hourly earnings, slowed as it increased by a slight 0.1% in March and 3.2% year-over-year.

Quote

“The two greatest enemies of the equity fund investor are expenses and emotions.”

– John C. Bogle

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