Major stock indices ended the week mixed with small gains in U.S. Stocks and small losses in developed international and emerging markets. While Q1 earnings are coming in strong, the effect is tempered by an uncertain outlooks from companies. The Federal Reserve met and chose to leave its benchmark interest rate unchanged at a 4.25% to 4.5%. Chair Powell emphasized a “wait and see” approach as tariffs could lead to higher prices and job losses making it difficult for the FED to decide to hold or cut rates further. In the U.K., the central bank cut its benchmark rate from 4.5% to 4.25% citing an easing in inflationary pressures.
OPEC+ agreed to another 411,000 barrel per day production increase for June. The lower global oil prices are likely to reduce drilling in the U.S.
Treasury bond yields rose with the 30-year bond yield at 4.833% and the 10-Year note at 4.369%. Freddie Mac reported that the average 30-year mortgage rate was unchanged at 6.76%. Crude oil rose to $60.95 a barrel and natural gas rose to $4.061 per MMBTUs. The U.S. dollar index fell to 100.37 and gold rose to $3343.10 an ounce.
In economic reports last week:
- S&P Global released its services purchasing manager indices for April. Keep in mind that anything over 50 represents expansion and anything under 50 represents contraction.
- US services PMI was fell from 54.4 to 50.8.
- Canada services PMI rose from 41.2 to 41.5.
- Japan services PMI rose from 50.0 to 52.4.
- Eurozone services PMI fell from 51.0 to 50.1.
- China services PMI fell from 51.9 to 50.7. China has not reported its manufacturing PMI.
- The Federal Reserve reported that consumer credit rose at a 2.4% pace in March.
- Revolving credit rose 1.7%.
- Nonrevolving credit rose 2.7%.
- The Commerce Department reported:
- The trade deficit soared 14.0% in March, as businesses and consumers acted to beat anticipated tariffs.
- Exports rose 0.2%.
- Imports rose 4.4%.
- Pharmaceuticals in particular had a large jump.
- The trade deficit soared 14.0% in March, as businesses and consumers acted to beat anticipated tariffs.
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- Wholesale inventories rose 0.4% in March following a 0.5% rise in February.
- Wholesale inventories rose 0.4% in March following a 0.5% rise in February.
- The Labor Department reported:
- Seasonally adjusted first-time claims for unemployment were 228,000, a decrease of 13,000 from the previous week’s unrevised level.
- The 4-week moving average of claims, designed to smooth out volatility, was 227,000 an increase of 1000 from the previous week’s unrevised level.
- For the full unemployment report go here: https://www.dol.gov/ui/data.pdf
- Nonfarm productivity fell 0.8% in the first quarter of 2025.
- Output decreased 0.3% and hours worked rose 0.6%.
- From the first quarter of 2024 productivity has risen 1.4%,
- Seasonally adjusted first-time claims for unemployment were 228,000, a decrease of 13,000 from the previous week’s unrevised level.
- 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 13.465MM BPD to 13.367MM BPD.
- Natural gas storage rose 104BN cubic feet and was about at its average level during the past five years at this time of year.
- Baker Hughes reported the number of oil rigs fell 5 to 473 and the number of natural gas rigs was unchanged at 101.
- Factset reported with 90% of S&P 500 companies reporting, the blended earnings increase was 13.4% 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
