A late-week rally helped push stocks higher to close a turbulent week on a favorable note. Last week began with stocks mixed as speculators tried to gauge evolving U.S. tariff policy. Ten-year Treasury yields jumped nearly 20 basis points to 4.20% last Monday, rebounding from the previous week’s six-month low. Stocks retreated last Tuesday following the administration’s threat of a 104% tariff on China, effective the following day. However, investors returned to risk after the U.S. announcement of a 90-day pause on many of the new tariffs. The market enjoyed its best day in several years as the S&P 500 gained 9.5%, the Dow rose 7.9%, and the NASDAQ climbed 12.2%. Wall Street reversed course on Thursday, cutting into most of the prior day’s gains. Investors re-focused their attention on the likelihood of a trade war with China. Typical of the volatile week, stocks rebounded to close out the week as optimism grew over a possible trade deal between the U.S. and China. Market sector performance was mixed, with information technology, communication services, and consumer discretionary outperforming, while real estate, financials, and energy lagged.
Last Week’s Economic News
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- Inflation trended lower in March, according to the latest Consumer Price Index.
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- Prices at the wholesale level fell in March, according to the Producer Price Index (PPI).
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- The federal government budget deficit was $161 billion in March.
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- The national average retail price for regular gasoline was $3.243 per gallon on April 7.
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- For the week ended April 5, there were 223,000 new claims for unemployment insurance, according to the Department of Labor.
Eye on the Week Ahead
The latest data on sales at the retail level is available this week. February saw retail sales tick up 0.2% for the month. Also, out this week is the estimate of industrial production for March. Industrial production rose 0.7% in February, while manufacturing output increased 0.9%.
Have a nice week!
Sincerely,
Robert G. Carpenter