Weekly Market Review - April 24, 2018

Weekly Market Review - April 24, 2018

by Chad Hassinger on Apr 24, 2018

Finance

By Bradley J. Rathe
Chief Investment Officer

"Politicians use economics the way a drunk uses a lamppost - for support, not illumination." -Alan Blinder

Weekly look back:
  1. Interest rates moved higher last week as the US Ten Year treasury approached 3%. Higher rates have taken the market by surprise as there are still nascent signs of inflation.
  2. Retail Sales have been stagnant the past few months. Last week’s reading finally did not disappoint. Consumer spending is a significant part of GDP so it is very important to see happy consumers.
  3. The dollar has started to gain some strength for the first time in many months. Factors at play are the rising rates in the US and ECB president saying that European growth has started to stagnate. Emerging Market equities have been weaker because of the stronger dollar.
Weekly look ahead:
  1. More than 1000 companies report earnings this week. So far the majority of earnings have beaten expectations as the tax cut start to come through to the bottom line.
  2. Normally the first quarter of each year has slower growth and this year is the same with expectations of 2% growth versus 2.9% for the fourth quarter of 2017. Manufacturing is a central theme for President Trump and Durable Goods orders are expected to show a strong showing of a 1.7% advance.
  3. Housing is starting to benefit from more supply as the median house price rose 5.8% over the past year to $250,400.
World Macro highlights for this week: 

Tuesday: New Home Sales, Consumer Confidence
Thursday: ECB Announcement, Durable goods
Friday: GDP, Employment Cost Index, Chicago PMI

2018 Yearly Index Returns as of 4/20/2018

S&P 500 

0.31%

Europe Equity

2.85%

Emerging Equity

0.69%

US 10 Yr

+.56 bp

US Small Cap Stocks

2.45%

 

Graph Of The Week

With interest rates on the rise it eventually will put a damper on home sales. 

Thumbnail