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In the Markets – Week-Ending April 29

by Peter J. Creedon

Newsletter: In the Markets – Week-Ending April 29
Crystal Brook Advisors
We Make Financial Planning Crystal Clear

United States: Inflation remained modest in March, a sign that pricing pressures are in check amid slow growth in the U.S. and overseas, and low oil prices.(1)

Europe: Government-bond yields are heading higher around the world, a move typically linked to rising expectations of economic growth and inflation.(2) Weakness in manufacturing and construction contributed to the slowdown in aQ1. The upcoming referendum on continued EU membership adds uncertainty to the U.K. economic outlook.(3)

Asia: China’s total debt grew to a record 237% of GDP in Q1. The surge in borrowing comes as the Chinese government yet again turns on the spigots in order to boost stuttering growth.(4) China’s central bank fixed the yuan 0.56% higher to give the currency its largest one-day appreciation since the historic revaluation.(5)

Monday 04/25

• Global stocks pulled back Monday, led by declines in commodity-sensitive stocks.(6)
• U.S. Government bonds yields waver due to oil price swings.(7)

Tuesday 04/26

• Consumer confidence fell 1.9 points in April, as a dip in expectations gave back all of the gain from the prior month.(8)
• Durable goods rose 0.8 percent in March but details show that the turnaround in the factory sector remains in question. Declining core capex shipments indicate another drag from equipment spending in Q1 GDP.(9)
• With a volatile and challenging first quarter almost in the books, the probability of a recession over the next six months is about 26 percent based on Wells Fargo’s model.(10)
• U.S. oil prices settled at a new 2016 high Tuesday as the dollar fell and traders bet that U.S. oil output would continue to fall.(11)

Wednesday 04/27

• Apple’s disappointing corporate earnings dragged the Dow industrials into the red, another sign of weakness for the technology sector.(12)
• Oil prices touched highs for the year, with U.S. prices breaking above $45 for the first time since November following data that showed a surprise drop in U.S. oil inventories.(13)
• Fed Keeps Interest Rates Steady and Says Labor Market Is Improving While policy makers noted some weak points in the domestic economy, the central bank appears on course to increase rates later in the year.(14)

Thursday 04/28

• First-quarter revenue for the company’s Amazon Web Services segment jumped 64% year over year to about $2.6 billion, which helped deliver its most profitable quarter ever.(15)
• U.S. corporate profits are set to decline for the third straight quarter, the longest and broadest slide in earnings since the financial crisis, weighed down by the energy slump and slowing growth around the world.(16)

Friday 04/29

• Exxon Mobil, the largest U.S. oil company, reported its smallest quarterly profit since 1999, a 63% plunge from a year ago, as oil prices remain depressed.(17)
• Global stocks were mostly lower, as a late-day selloff in U.S. tech shares reverberated overseas.(18)

 

Market Close
U.S. stocks ended lower Friday, barely clinging to monthly gains, as disappointing economic data and corporate earnings raised doubts about the strength of the U.S. economy. The S&P 500 SPX, -0.51% slid 10.50 points, or 0.5%, to 2,065.31, with health-care and information technology shares logging the largest declines.(19)

Contributor: Oscar Xia

Sources:
(1) Source: Wall Street Journal
(2) Source: Wall Street Journal
(3) Source: Wells Fargo Economics Group
(4) Source: Seeking Alpha
(5) Source: Seeking Alpha
(6) Source: Wall Street Journal
(7) Source: Wall Street Journal
(8) Source: Wells Fargo Economics Group
(9) Source: Wells Fargo Economics Group
(10) Source: Wells Fargo Economics Group
(11) Source: Wall Street Journal
(12) Source: Wall Street Journal
(13) Source: Wall Street Journal
(14) Source: New York Times
(15) Source: Wall Street Journal
(16) Source: Wall Street Journal
(17) Source: Wall Street Journal
(18) Source: Wall Street Journal
(19) Source: MarketWatch