After falling sharply on Monday, markets rose sharply on Tuesday as Trump clarified that he does not intend to fire Federal Reserve Chair, Jerome Powell and Treasury Secretary Scott Bessent said the current level of China tariffs are unsustainable.  On Wednesday, the markets continued to rally but the rally slowed after Scott Bessent said the U.S. would not act unilaterally on China tariffs.  Then on Thursday, China demanded the U.S. remove unilateral tariffs among other concerns prior to any trade talks.  However, the markets continued to rise at least partly due to strong tech earnings.  The markets ended the week with substantial gains with the Nasdaq 100 index showing the biggest gains and the Dow 30 Industrials lagging but still experiencing substantial gains. 

The International Monetary Fund cut its forecast for U.S. growth to 1.8% this year from its previous prediction of 2.7% due to trade tensions.  The IMF cut its global growth forecast from 3.3% to 2.8%.

Treasury bond yields fell with the 30-year bond yield at 4.719% and the 10-Year note at 4.258%.  Freddie Mac reported that the average 30-year mortgage rate fell to 6.81%.  Crude oil fell to $63.25 a barrel and natural gas fell to $2.96 per MMBTUs.  The U.S. dollar index rose to 102.91 and gold fell to $3317.20 an ounce.

In economic reports last week:

• The National Association of Realtors reported that existing home sales fell 5.9% in the month of March and were down 2.4% from March 2024.
  • The NAR cited high mortgage rates.
  • Existing home sales make up the vast majority of the home sales.
• The Commerce Department reported:
  • New home sales rose a seasonally adjusted 7.0% in the month of March and were up 6.0% from last March.

• The Labor Department reported:
  • Seasonally adjusted first-time claims for unemployment were 222,000, a decrease of 6,000 from the previous week’s revised level.  
    • The 4-week moving average of claims, designed to smooth out volatility, was 220,250 a decrease of 750 from the previous week’s revised level.
    • For the full unemployment report go here:  https://www.dol.gov/ui/data.pdf
• The EIA weekly oil report is here: Weekly Petroleum Status Report.  Also, the EIA reported in the prior week:
  • Field production of crude oil fell from 13.462MM BPD to 13.460MM BPD.
  • Natural gas storage rose 88BN cubic feet and was below its average level during the past five years at this time of year.
• Baker Hughes reported the number of oil rigs rose 1 to 482 and the number of natural gas rigs rose 1 to 99.
• Factset reported with 36% of S&P 500 companies reporting, that the blended earnings increase was 10.1% from a year ago.

Please call us if you have any questions.

Loren Rex – Emeritus

Erik A Smith, AIF® – President & C.E.O.

Nicholas Acri, CFP® – Partner & Wealth Advisor

Dylan Thomas, CFP® – Partner & Wealth Advisor

These are the opinions of Loren Rex and Erik Smith and are not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice. The Indices mentioned are unmanaged and cannot be invested into directly. The Dow Jones Industrial Average, Dow Jones, or simply the Dow, is a stock market index of 30 prominent companies listed on stock exchanges in the United States. The DJIA is one of the oldest and most commonly followed equity indexes. The Nasdaq Composite is a stock market index that includes almost all stocks listed on the Nasdaq stock exchange (more than 2500 stocks).

Sources:

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRFPUS2&f=W

https://ir.eia.gov/ngs/ngs.html

https://www.freddiemac.com/pmms

https://www.wsj.com/market-data?mod=nav_top_subsection

https://bakerhughesrigcount.gcs-web.com/na-rig-count

https://www.census.gov/economic-indicators

https://www.federalreserve.gov/releases/g17/current/default.htm

https://www.bls.gov/mxp/

https://advantage.factset.com/hubfs/Website/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_041725.pdf