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Weekly Market Update — April 1, 2019

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STOCKS END THE WEEK AND FIRST QUARTER WITH A BANG

  • Ride–sharing firm Lyft went public on Friday, valuing the company at close to $30 billion as it rose over 20% in its first day of trading before settling in with a gain of 8.7%
  • Lyft’s IPO also marks the largest initial public offering for the year to date
  • The U.S. markets erased last week’s declines and finished the week and the first quarter of 2019 with a bang, as the S&P 500 delivered its best quarter since 2009 with a quarterly gain of 13.1%, after this week’s gain of 1.2%
  • The DJIA added 1.7%, NASDAQ returned 1.1% and the smaller-cap Russell 2000 jumped 2.3%, bringing investors quarterly gains of 11.2%, 16.5%, and 14.2%, respectively
  • Nine of 11 of the S&P 500 sectors finished in the green, led by the Industrials sector’s return of 2.9%, Consumer Discretionary sector’s return of 1.9% and the Consumer Staples sector’s advance of 1.6%
  • The Utilities sector and the Communications Services sector were the two lone sectors finishing in the red, both with a -0.5% return on the week
  • The 2–yr yield and the 10–yr yield both declined on the week to 2.27% and 2.41%, respectively
  • For the month of March, the 2–yr yield has dropped 23 basis points, while the 10–yr yield has dropped 30 basis points
  • The U.S. Dollar Index advanced 0.6% to 97.27
  • Volatility as measured by the CBOE Volatility Index spiked early in the week but then leveled out

Weekly Market Performance

Stocks End the Week and Quarter with a Bang

The markets ended the week and the quarter with very positive gains as the DJIA, S&P 500 and NASDAQ all moved more than 1% on the week. The S&P 500 recorded its strongest quarterly performance in a decade, rising 13% and leaving the index 3% off its all–time high. NASDAQ did not perform as well as the DJIA or S&P 500 on the week, but its 16.5% gain for the first quarter was nothing shy of remarkable.

There were a lot of positive developments on the quarter, but the three that seemed to dominate headlines throughout and contribute to the markets positive moves were the Federal Reserve’s change with respect to rate hikes, solid corporate earnings results and guarded optimism that a trade war with China will be averted.

Industrials Lead the Sectors This Week

The Industrial sector performed the best this week within the S&P 500 sectors, partially driven by an upward tick in Boeing after they announced a software fix for its 737 Max airliners. The big Communication Services sector lagged on the week, partially due to a report that the proposed merger between T-Mobile and Sprint might be in trouble with regulators.

Not Everything Was Rosy, Especially with Housing

  • The Commerce Department released data showing a nearly 9% drop in housing starts in February;
  • Year–over–year changes in housing price gains fell to its lowest level since 2011;
  • The National Association of Realtors reported that pending home sales declined in February versus the year before;
  • Personal income and spending missed expectations; and
  • The Commerce Department slightly lowered its estimate of fourth-quarter Gross Domestic Product growth.

Around the World

  • The pan-European Stoxx Europe 600 Index and the UK’s FTSE 100 Index rose for the week
  • The Nikkei 225 Stock Average fell 1.9% for the week, but is up 6% for the quarter
  • The large-cap TOPIX Index and the TOPIX Small Index also dropped this week, but are also up about 6% for the quarter
  • The Shanghai Composite Index lost 0.4% this week, while the large-cap CSI 300 Index, China’s blue chip benchmark, added 1.0%. The CSI 300 Index climbed 29% for the first quarter, its best performance since the end of 2014
  • Argentine stocks, as measured by the Merval Index, rose about 2%
  • Turkish stocks, as measured by the BIST-100 Index, cratered more than 6%





 

Sources

nar.realtorstandardandpoors.comcboe.combls.govcommerce.govsec.gov;
federalreserve.govdol.govmsci.comnasdaq.comdowjones.commorningstar.com;
edwardjones.combloomberg.com



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