For today’s article, we will review our Market Update for the 2nd Half of April! April has been a busy month for the markets with many ups and downs. The economy is showing signs of recovery from the pandemic, but also indicating high risks of inflation. As a result, investors are taking in the market on a day-by-day basis. Here at FFR we believe that successful investing starts with a strong financial education. We encourage investors to think critically, pay attention to market patterns, and remove emotion from the equation. If you are looking for an effective way to manage these, aspects feel free to check out the strategies that we offer for forex, options, index futures, or commodities pages to learn more. If you would rather, you can always speak with a member of our client care team by giving us a call at (800) 883-0524 or contacting us via email or our contact form. If you would simply like to sign up for notifications for our biweekly Market Movers Newsletter, send us an email at [email protected] or come back to visit our blog every two weeks! Now, let’s discuss what moved the markets with our market update for the and half of April!
Friday – April 16
- Stocks are on the rise again as the market’s record run continues amid strong earnings from blue-chip companies as well as encouraging data signaling a bounce back in the economy.
- Morgan Stanley–the last of the six largest U.S. banks reported a strong earnings beat, bolstered by trading profits and investment banking results.
- Wall Street is poised to wrap up another winning week–the S&P 500 gaining 1.3%, the Dow climbing 1%, and the Nasdaq rising 0.9%.
- Investor sentiment rose thanks to a slew of economic data this week pointing to a rebound in consumer spending, sentiment and the jobs market.
- The preliminary consumer sentiment index rose to a one-year high of 86.5 in the first half of this month from 84.9 in March.
- The Federal Reserve’s Christopher Waller said the US economy is poised to take off, yet there’s still no reason to start tightening policy.
Monday – April 19
- The broader market experienced its own version of a Manic Monday as stocks slipped into the close.
- Tech stocks led the fall with FAANG stocks taking the hardest hit.
- EV also got slammed amid news of the Tesla weekend crash, prompting investors to question the company’s driverless ambitions.
- No major economic reports were released today.
Tuesday – April 20
- Today was another rocky session for the stock market with the worst two-day slide in over a month.
- The Dow fell as much as 390 points though ending the day down 260 points.
- The tech sector and airline industry led the market down for the most part as investors sought a more defensive positioning in the market.
- No major economic reports were released today.
Wednesday – April 21
- Stocks turned positive today shortly after the open after the two-day slide that preceded it.
- The good news is that corporate earnings guidance, across a wide swathe of sectors, is back once again, hinting at enough economic stability to forecast performance in the coming quarters.
- Additionally, many companies have been upping their forecasts in the quarters to come.
- The bad news is that many analysts are thinking this might be “as good as it gets,” that we’re hitting peak earnings and peak recovery, and that everything positive is already priced-in.
- Another worrying sign is that the market hasn’t had a major dip since last Fall and volatility is nowhere to be seen–a worrying sign of complacency or perhaps even exuberance.
- New mortgage application revealed some optimism, the composite index up 8.6% against the prior week’s -3.7%.
- Mortgage applications for new purchases was up 6.0% from last week’s -1.0%; and refis jumped up 10.0% versus last week’s -5.0%.
Thursday – April 22
- All major US stock averages were down around 1% with the Dow plunging over 400 points before ending the day with a 320-point drop.
- Tax talk spooked the market, as the White House proposed raising the capital gains tax rate to 39.6% for Americans earning more than $1 million a year.
- Initial jobless claims ending 4/17 came in much lower than expected, at 547,000 new claims versus the anticipated 615,000.
- March new home sales stood at 6.010 million, slightly below analyst expectations of 6.205 million.
- Home sales are down -3.7% month over month but up 12.3% year over year.
Friday – April 23
- Stocks rebounded as investors reassessed concerns regarding the White House’s capital gains tax hike proposal.
- Bloomberg News reported that the Biden plan can result in a capital gains tax hike to as high as 43.4% for Americans making over $1 million a year.
- But with the Democrats’ narrow majority control in Congress, the tax bill like this could face challenges, and many on Wall Street believe that a less dramatic increase is more likely.
Monday – April 26
- Today marked a quiet start to a busy week as stocks nudged slightly ahead a slate of big tech earnings plus an FOMC meeting this week.
- March durable goods orders came in at 0.5%, below 2.0% consensus expectations.
- April Dallas Fed manufacturing activity saw a higher-than-expected surge to 37.3, above the expected figure of5.
Tuesday – April 27
- It was a quiet session for the broader market with stocks trading in a tight range.
- Overall, the major indices ended the day relatively flat.
- February Case-Shiller Home Price Index rose to 1.2% month over month, slightly above 1.1% consensus, and 11.9% year over year, slightly topping 11.8% consensus.
- April consumer confidence saw a far-higher than expected uptick to 121.7, topping expectations of 112.0.
Wednesday – April 28
- Today’s session was steady though relatively flat as the Federal Reserve wrapped up its FOMC meetings leaving rates unchanged.
- Fed Chair Powell gave no indication as to when the Fed might step back from its rock bottom rate policy.
- He emphasized that the recovery remains uneven and incomplete, and that inflation remains transitory.
- Overall, nothing has really changed since the last FOMC meeting, and investors may be focusing on earnings and the big names reporting this week.
Thursday – April 29
- It was a rollercoaster session for the broader market, the Dow swinging in a 340 point range before ending up 349. While the S&P 500 managed to clench another record close.
- Amazon (AMZN) smashed analyst expectations upon reporting after market close while rideshare stocks tanked after Labor Secretary Marty Walsh said that most gig workers should be classified as employees.
- Midway through earnings season, companies have been beating expectations by more than 20%, far above the historic average of around 3% to 5%.
- Even with rising input costs, companies have been able to manage stable profit margins and investors haven’t punished companies yet for raising prices.
- GDP for the first quarter of 2021 came in at 6.4% quarter over quarter, slightly under expectations of 6.5%.
- 553,000 new jobless claims were filed last week, around 5,000 less than expected.
- Pending home sales rose in March, up 1.9% month over month, though lower than the expected figure of 3.8%.
Friday – April 30
- The major averages opened in the negative as investors digested a flurry of earnings results and a robust profit beat from e-commerce giant Amazon.
- The employment cost index, which is the broadest measure of labor costs including wages, salaries, and benefits, rose slightly above consensus expectation, giving us the figure of 0.9% versus the expected 0.7%.
- Personal income in March rose 21.1% month over month versus the expected 20.3%, and personal spending rose 4.2% over the same period versus 4.0%.