Equities continued their positive trend in April, spurred by favorable corporate earnings reports, proposed federal tax cuts, and positive economic signals overseas. The Nasdaq surpassed 6000 for the first time in its history, while the small-cap Russell 2000 reached a record high by the end of April. Each of the benchmark indexes listed here posted monthly gains, led by Nasdaq, which increased 2.30%, followed by the Global Dow, which gained almost 1.50% month-over-month. The large-cap Dow and S&P 500, while gaining in value, may have lagged a bit following less than favorable GDP and jobs growth. The yield on 10-year Treasuries fell 10 basis points as bond prices increased.
By the close of trading on April 28, the price of crude oil (WTI) was $49.19 per barrel, down from the March 31 price of $50.85 per barrel. The national average retail regular gasoline price was $2.449 per gallon on April 24, 2017, up from the March 27 selling price of $2.315 and $0.287 more than a year ago. The price of gold climbed at the end of April, closing at $1,269.50 on the last trading day of the month, up from its March 31 price of $1,250.60.
|Market/Index||2016 Close||Prior Month||As of April 28||Month Change||YTD Change|
|Fed. Funds rate target||0.50%-0.75%||0.75%-1.00%||0.75%-1.00%||0 bps||25 bps|
|10-year Treasuries||2.44%||2.38%||2.28%||-10 bps||-16 bps|
Equities data reflect price changes, not total return.
The prices companies receive for goods and services fell in March from February, as the Producer Price Index dropped 0.1% for the month. Year-over-year, producer prices have increased 2.3%. Energy prices play a large part in the movement of the PPI, and in March energy prices slipped 2.9%, while food prices increased 0.9%. The PPI less food and energy has risen 1.6% for the year, after recording no change in March from February.
In another sign of waning inflation, consumer prices also retreated in March, slipping 0.3% from February. For the year, consumer prices are up 2.4%. Core prices, which exclude food and energy, dropped 0.1% for the month and have increased 2.0% since March 2016.
The FOMC did not meet in April, so the Committee will have plenty of economic data to consider when it next meets during the first week of May. Job creation slowed some in March, and April’s figures don’t come out until May 5. The FOMC may opt to leave interest rates alone until June’s meeting, to see if the labor market picks up the pace.
Data sources: Economic: Based on data from U.S. Bureau of Labor Statistics (unemployment, inflation); U.S. Department of Commerce (GDP, corporate profits, retail sales, housing); S&P/Case-Shiller 20-City Composite Index (home prices); Institute for Supply Management (manufacturing/services). Performance: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); http://www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.
The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. The U.S. Dollar Index is a geometrically weighted index of the value of the U.S. dollar relative to six foreign currencies. Market indices listed are unmanaged and are not available for direct investment
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