While volatility was lower than the previous week, it was still substantial given tariff uncertainty and new export restrictions on semiconductors. Also, Q1 earnings releases of major corporations started this week. Major stock indices ended the holiday shortened week mixed with the largest gain in developed international stocks and modest losses in the Dow 30 Industrial and the Nasdaq 100 indices.
The European Central Bank cut its benchmark interest rate, by 0.25% to 2.25%. The ECB stated the “outlook for growth has deteriorated owing to rising trade tensions.”
Treasury bond yields fell with the 30-year bond yield at 4.803% and the 10-Year note at 4.330%. Freddie Mac reported that the average 30-year mortgage rate rose to 6.83%. Crude oil rose to $64.68 a barrel and natural gas fell to $3.245 per MMBTUs. The U.S. dollar index rose to 102.91 and gold soared to $3,328.40 an ounce.
In economic reports last week:
- China reported gross domestic product rose at a 5.4% annualized rate in the 1st quarter versus the same period in 2024.
- Retail sales rose at a 5.9% rate.
- Industrial output rose at a 7.7% rate.
- Urban unemployment fell from 5.4% in February to 5.2% in March.
- The Federal Reserve reported that industrial production fell 0.3% in March but was up 1.3% from a year ago.
- Manufacturing rose 0.3% and was up 1.0% from a year ago.
- Mining, including oil and gas production rose 0.6% and was up 1.0% year over year.
- Utilities fell 5.8% but were up 4.4% from last March.
- The Commerce Department reported:
- Advanced monthly sales for retail and food services, seasonally adjusted, rose 1.4% in March, following a 0.2% increase in February.
- Automobiles and parts rose 8.8% in March as buyers moved to beat anticipated price increases due to tariffs.
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- Business inventories rose seasonally adjusted 0.2% in February, following a 0.3% rise in January.
- Business inventories rose seasonally adjusted 0.2% in February, following a 0.3% rise in January.
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- Housing starts fell a seasonally adjusted 11.4% in March but were up 1.9% up from last March.
- Permits, a sign of future housing starts, rose 1.9% in March.
- Permits, a sign of future housing starts, rose 1.9% in March.
- Housing starts fell a seasonally adjusted 11.4% in March but were up 1.9% up from last March.
- The Labor Department reported:
- The import price index fell 0.1% in March following a 0.2% increase in February.
- From a year ago, import prices rose 0.9%.
- Non-fuel import prices rose 0.1% and fuel import prices fell 2.3% in March.
- Seasonally adjusted first-time claims for unemployment were 215,000, a decrease of 9,000 from the previous week’s revised level.
- The 4-week moving average of claims, designed to smooth out volatility, was 220,750 a decrease of 2,500from the previous week’s revised level.
- For the full unemployment report go here: https://www.dol.gov/ui/data.pdf
- The import price index fell 0.1% in March following a 0.2% increase in February.
- 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 13.580MM BPD to 13.458MM BPD.
- Natural gas storage rose 57BN 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 481 and the number of natural gas rigs rose 1 to 98.
- Factset reported with 12% of S&P 500 companies reporting, that the blended earnings increase was 7.2% from a year ago.
Please call us if you have any questions.
Loren Rex – Emeritus
Erik A Smith, AIF® – President & C.E.O.
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
