Weekly Market Performance – Markets Finish Lower Amid Key Economic Data Releases
U.S. and International Equities
Markets Finish Mixed
For the second straight week, the majority of U.S. market indexes finished lower as the continued Eastern European conflict and a sticky Consumer Price Index inflation report renewed inflation concerns. Last week’s Federal Open Market Committee meeting minutes added to worries about monetary policy and continued to weigh on investor sentiment. International equities, per the MSCI EAFE and the MSCI EM indices, were not immune and also fell during the week.
Consumer staples had a strong showing for the second consecutive week, while value sectors materials and industrials led the week. The energy sector, which has been the sector leader so far for 2022, continued its run higher on strong energy prices. Growth sectors trailed for the week as investors took note of the Fed’s hawkish sentiment, selling off stocks with relatively higher valuations.
Fixed Income Lower
The Bloomberg Aggregate Bond Index finished lower for the second straight week, reverting back to its downward trend that has prevailed so far in 2022. High-yield corporate bonds, as tracked by the Bloomberg High Yield index, also followed suit.
Crude oil finished higher this week on increased Eastern European tensions. This marks a reversal from the prior two weeks when increased supply, from the release of international oil stockpiles, and concerns over reduced demand, relating to Chinese COVID-19 lockdowns, had put downward pressure on oil prices. Moreover, natural gas prices finished higher for a fourth consecutive week as the potential for more energy related sanctions relating to Ukraine-Russia war continued to spook markets. The major metal prices for gold, silver, and copper also finished the week higher. All three metals are solidly higher for 2022.
Economic Weekly Roundup
The March headline Consumer Price Index increased by 8.5% year-over-year. This was the fastest annual gain since December 1981. Increasing food, energy, and housing costs accounted for much of last month’s gain. Core CPI, which excludes food and energy costs, increased 6.5% on an annual basis. This being said, on a month-over-month basis, core CPI came in slightly less than economists’ expectations.
March Retail Sales
Retail sales for March increased fractionally in comparison to February. This month’s reading also came in slightly below economists’ expectations. The largest gain in last month’s retail sales was seen at gas stations. This category saw an 8.9% increase in sales as gasoline prices rose over 18% for March. Online sales showed a steep decline, receding almost 6.5% compared to February. Across the board, retail sales increased almost 7% from March 2021.
Initial Claims Missed Expectations; Continuing Claims Decline
Initial claims for unemployment insurance for the week ending April 9 came in above the previous’ week’s total as well as above economists’ expectations. In addition, continuing claims declined from the prior week which was also below economists’ estimates. The data continues to illustrate a tight labor market that is unlikely to dissuade the Fed from focusing on inflation in the near term.
The following economic data is slated to be released during the week ahead:
Monday: April National Association of Home Builders Housing Market Index
Tuesday: March building permits and housing starts
Wednesday: Federal Reserve Beige Book, March existing home sales
Thursday: Weekly initial and continuing unemployment claims, March leading indicators
Friday: April Purchasing Managers Index
This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.
References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results. All market and index data comes from FactSet and MarketWatch.
Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities. All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
U.S. Treasuries may be considered “safe haven” investments but do carry some degree of risk including interest rate, credit, and market risk. Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.
For a list of descriptions of the indexes referenced in this publication, please visit our website at lplresearch.com/definitions.
This Research material was prepared by LPL Financial LLC.
Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).
Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor that is not an LPL affiliate, please note LPL makes no representation with respect to such entity.
Not Insured by FDIC/NCUA or Any Other Government Agency
Not Bank/Credit Union Guaranteed
Not Bank/Credit Union Deposits or Obligations
May Lose Value
For Public Use – Tracking 1-05266391