AAM Weekly Market Wrap – May 5, 2014

Weekly Market Wrap: Stocks gained on mixed economic data with a jobs report rebound and a slowdown in 1Q growth.

 

For The Week

  • The S&P 500 gained 0.95% to 1,881.14
  • Oil fell 0.83% to $99.76
  • Gold slipped 0.41% to $1,297.81
  • The US Dollar dropped 0.31% to $79.51 against other major world currencies.

 

2014 Year-To Date for the major indexes:

 

  • The S&P Index +1.79%
  • The Dow Jones Index -0.38%
  • The NASDAQ Index -1.26%
  • The Russell 2000 Small cap Index -2.99%
  • EAFE International Index +2.32%
  • 10 Year Treasury Yield is 2.58%, lower for the week and lower for the year
  • 30 Year Treasury Yield is 3.36%, lower for the week and lower for the year
  • WTI Crude Oil Index +1.36%
  • Bloomberg Gold Index +8.00%
  • The Dollar Index -0.82% against other major world currencies

 

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Monday the S&P 500 index gained 6 points on moderate volume as both pending home sales and regional manufacturing beat expectations.

 

Tuesday stocks added 9 points on moderate volume as housing prices rose and consumer confidence missed.

 

Wednesday the S&P index gained 6 points on moderate volume as the Fed announced that the Taper will continue, reducing asset purchases by another $10M, 1Q GDP estimate missed with a growth rate of 0.1%, employment costs rose but beat expectations, mortgage applications declined, ADP job growth and regional manufacturing both beat expectations.

 

Thursday stocks were flat on moderate volume as personal spending and manufacturing data beat expectations, weekly jobless claims rose, construction spending missed and auto sales were mixed for April.

 

Friday the S&P 500 index slipped 3 points on moderate volume as the April jobs report beat expectations adding 288,000 jobs – it’s best gain since January 2012.  The unemployment dropped from 6.7% to 6.3% – it’s lowest since September 2008.  Factory orders rose but missed expectations.

 

 

 

Takeaways from this week:

 

  • US data was mixed this week with a sour 1Q GDP estimate but an outstanding jobs report.  The GDP number was slowed by the weather in the 1st quarter and could be excused as long as it bounces back in 2Q.  The jobs report was a bounce back from prior quarter misses but a reduction in the labor force has some concerned.
  • Bond yields continued lower this week.
  • Overseas markets rebounded.

 

 

 

 

 

Mortgage rates were higher last week.  The national averages as reported by Bloomberg indicate a 15-year rate of 3.36% and a 30-year rate of 4.40%. These rates are as of 05/02/2014 and may include points.

 

 

 

What to watch for on the economic calendar this week:

 


Monday –PMI Services / ISM Non-Manufacturing

 

Tuesday – Fed Redbook

 

Wednesday – Weekly Mortgage Applications / Productivity and Costs / Consumer Credit

 

Thursday – Weekly Jobless Claims

 

Friday – Job Openings

 

 

 

 

 

Ronald J. VanSurksum, CFP®
Advanced Asset Management, LLC

 

May 5, 2014

 

 

 

 

 

 

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