Weekly Market Performance – Markets Finish Lower After Volatile Week

Markets Blog

Index Performance

U.S. and International Equities

Markets Finish Lower

For the fourth straight week, the U.S. market indexes finished lower as investors remain concerned over inflation’s potential grip on future corporate profits as well as the economic outlook. Last week, Federal Reserve (Fed) Chairman Jerome Powell discussed the possibility of a half-point interest rate increase, which adversely affected market sentiment. International equities, per the MSCI EAFE and the MSCI EM indices, also fell during the week.

Not one sector finished the week higher. The energy sector, after lagging the market last week, is still easily leading all other sectors so far in 2022 as oil continues to outperform.

Fixed Income Lower

The Bloomberg Aggregate Bond Index finished higher this week amid anticipation of next week’s Federal Reserve meeting, reversing lower trends experienced for three consecutive weeks. High-yield corporate bonds, as tracked by the Bloomberg High Yield index, did not follow suit, and finished lower for the week dragged lower by weak equity market performance.

Commodities Mixed

Crude oil prices rebounded higher this week bucking last week’s lower close over concerns of increased supply from the release of the international oil stockpile. Moreover, natural gas continues its run higher after last week’s pullback. The major metal prices for gold, silver, and copper continued to lose ground for the second consecutive week. Copper and silver are now negative for 2022.

Economic Weekly Roundup

Consumer Confidence Steady

April’s Consumer Confidence pulled back slightly from March’s increase. This month, consumer confidence came in at just above 107, below economists’ expectations. The Present Situations Index, which is based on consumers’ beliefs of present business and labor market conditions, also declined. Within this the expectations index short-term outlook for income, business and labor market landscape did however all nudge slightly higher in April.

Durable Goods Solid

Orders for durable goods rebounded in March after declining in February. That being said, March’s reading came in just below economists’ estimates. Nevertheless, the increase continues to show that the economy is still growing at a steady pace amid supply chain disruptions and inflationary concerns.

Weekly Employment Report

Initial claims for unemployment insurance for the week ending April 16 came below the previous’ week’s total but reached economists’ expectations. In addition, continuing claims declined from the prior week which was also below economists’ estimates. Continuing claims continue to make new record lows, surpassing levels not seen since 1970. The data continues to illustrate a very tight labor market that is unlikely to be a reason to dissuade the Fed from maintaining focus on inflation in the near term.

Week Ahead

The following economic data is slated to be released during the week ahead:

• Monday: Markit April PMI Manufacturing Index, March construction spending, April ISM Manufacturing report

• Tuesday: March durable and factory orders, March JOLTS Job Openings

• Wednesday: March trade balance, April PMI composite, ADP employment survey; FOMC meeting

• Thursday: Weekly initial and continuing unemployment claims, Q1 unit labor costs and productivity

• Friday: April hourly earnings and workweek statistics, manufacturing, non-farm and private non-farm payrolls, consumer credit, March unemployment report

Next week, we continue through Q1 earning season with over 160 companies reporting results.

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