Volatility continued into this week as rising long term interest rates pushed down tech stocks on Monday with the Nasdaq entering correction territory. Tech stocks staged a massive rally on Tuesday. The recovery continued through the rest of the week on falling unemployment claims and the passage of another round of stimulus.
Major stock indices ended higher with the Russell 2000 small cap index rose the most. At this point 13% of U.S. adults are now vaccinated and President Biden promised that all adults would be able to receive a vaccine by May 1st.
Treasury yields rose with the 30-year bond yield closing at 2.318% and the 10-Year note closing at 1.625%. Crude oil fell to $65.58 a barrel while natural gas fell to $2.626 per MMBTUs. The U.S. dollar index fell to 91.67 and gold rose to $1723.10 an ounce.
In the economic numbers this week:
- The Labor Department reported:
- The consumer-price index rose 0.4% in February. Excluding volatile food and energy, consumer prices rose only 0.1%. From a year earlier price rose 1.7% and core prices rose 1.4%.
- The producer-price index rose 2.8% from a year earlier in February up from 1.7% year over year in January. Excluding volatile food and energy producer prices rose 2.2% year over year. The gain was driven largely by a 13.1% increase in gasoline prices.
- A seasonally adjusted 712,000 workers filed initial claims for unemployment in the week ending March 6th. This was a decrease of 42,000 from a revised 754,000 the week before.
- The 4-week moving average, designed to smooth out volatility, was 759,000, a decrease of 34,000 from the previous week’s revised average.
- Continuing claims fell from a revised 4.3MM to 4.1MM in the week ending February 27th.
- A broader measure of claims including extended benefits, pandemic assistance and other programs rose from 18.0MM to 20.1MM the week ending February 20th.
- For the full unemployment report go here: https://www.dol.gov/ui/data.pdf .
- The EIA weekly oil report is here: http://ir.eia.gov/wpsr/wpsrsummary.pdf . Also, the EIA reported in the prior week:
- Field production of crude oil rose from 10.0MM barrels per day to 10.9MM BPD.
- Natural gas storage fell 52BN cubic feet and is below the average level at this time of year during the past five years.
- Baker Hughes reported the number of active oil rigs fell 1 to 309. The number of active natural gas rigs was unchanged at 92.
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Loren C. Rex, CFP®, MA Erik A Smith AIF®
President Managing Partner
Generations Financial Planning & Wealth Management 269-441-4143
77 E. Michigan Ave, Suite 140
Battle Creek, MI 49017
Carrie Fuce, Assistant 269-441-4091
Toll Free: 800-513-8180
Visit our Website: www.genfinplan.com
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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.