At 56.5, the Institute for Supply Management’s March non-manufacturing index came in 0.4 points beneath its February reading but still indicated healthy expansion for the service industry. While business activity fell by 1.9%, new orders improved 1.1% and new export orders 6.0%. America’s service sector grew for a 62nd straight month.1COULD THE FED TIGHTEN LATE IN Q2?
Minutes from the Federal Open Market Committee’s March policy meeting stated that “several participants” felt economic data was strong enough to prompt an interest rate increase at its June meeting. (Federal Reserve board officials and regional presidents are all defined by the Fed as “participants.”) Richmond Fed president Jeffrey Lacker reiterated his support for a hike to reporters last week, noting that rates could be reduced again if economic conditions warranted.2
OIL PRICES CLIMB 5.1% IN A WEEK
That advance took light sweet crude to a NYMEX close of $51.64 a barrel Friday, and that rise came even with a 6% descent last Wednesday. Gold had a relatively flat week, gaining 0.3% on the COMEX to settle Friday at $1,204.60; silver futures moved south 1.9%, ending the week at $16.38.3,4
STOCKS PUSH HIGHER
Intriguing M&A activity helped the market rally last week. The Nasdaq advanced 2.23% in five days to close at 4,995.98 Friday. The Dow moved north 1.66% to 18,057.65 while the S&P 500 rose 1.70% to 2,102.06.5
THIS WEEK: Nothing major is scheduled for Monday. Tuesday brings earnings from JPMorgan Chase, Wells Fargo, Fastenal, Intel, CSX and Johnson & Johnson, plus the March PPI and data on March retail sales and euro area industrial output. Wednesday offers data on industrial production in the U.S. and China, a GDP reading from China, a new Fed Beige Book and earnings from Bank of America, Charles Schwab, Delta Air Lines, Kinder Morgan, Netflix, PNC, Progressive, SanDisk and U.S. Bancorp. On Thursday, housing starts numbers for March arrive, G-20 finance ministers meet in Washington D.C. and earnings from American Express, AMD, Blackstone Group, Citigroup, Goldman Sachs, Mattel, Philip Morris and Sherwin-Williams appear. The University of Michigan’s preliminary March consumer sentiment index comes out Friday, and so do the March CPI and the latest CPI for the euro area; on the earnings front, GE, Comerica, Seagate Technology and Honeywell all issue announcements.
|% CHANGE||Y-T-D||1-YR CHG||5-YR AVG||10-YR AVG|
|REAL YIELD||4/10 RATE||1 YR AGO||5 YRS AGO||10 YRS AGO|
|10 YR TIPS||0.14%||0.51%||1.56%||1.82%|
Sources: online.wsj.com, bigcharts.com, treasury.gov – 4/10/156,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.
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1 – ism.ws/ismreport/nonmfgrob.cfm [4/6/15]
2 – tinyurl.com/oyqdoyl [4/10/15]
3 – marketwatch.com/story/oil-futures-stable-after-volatile-week-wti-above-50-a-barrel-mark-2015-04-10 [4/10/15]
4 – marketwatch.com/story/gold-struggles-to-hold-weekly-winning-streak-alive-2015-04-10 [4/10/15]
5 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [4/10/15]
6 – markets.wsj.com/us [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F3%10F14&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F10%2F14&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F10%2F14&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F9%2F10&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F9%2F10&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F9%2F10&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F11%2F05&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F11%2F05&x=0&y=0 [4/10/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F11%2F05&x=0&y=0 [4/10/15]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [4/10/15]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [4/10/15]