Commonwealth

Today’s post was cowritten by Peter Essele, vice president of investment management and research.

I was going to write a piece on inflation today, but I got sidetracked. Sorry about that, and I promise to post on that topic tomorrow. Today, I am spending some time on getting back to work—in the office.

Last week saw a number of important data releases, with much of the focus falling on the April inflation reports showing prices rising by more than expected during the month. This will be another busy week for updates, with the housing sector and the minutes from the most recent Fed meeting serving as highlights.

Given how much things have improved, I’ll be taking this video to a monthly schedule, on the second Friday of the month—I’ll see you then.

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Market Risk Update. Thanks for the assist, Sam!

Equity markets continued to rally in April, with all three major U.S. indices setting new all-time highs during the month. The Dow Jones Industrial Average gained 2.78 percent in April, while the S&P 500 saw a 5.34 percent increase. The Nasdaq Composite led the way with a 5.43 percent gain. Markets were supported by improvements on the public health front and falling long-term interest rates. The 10-year Treasury yield declined in April, breaking a three-month streak of rising long-term rates.

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Economic Risk Factor Update. Thanks for the assist, Sam!

The economic recovery continued in April, driven by improvements on the public health front and the lingering tailwind from the most recent federal stimulus bill. Consumer confidence surged during the month, highlighting increased optimism from consumers for a return to more normal economic conditions throughout the year. Service sector confidence fell slightly in April but remains near record territory. The weakest data point was employment, with April’s employment report showing a significant drop in job growth. Although it marked four consecutive months with job growth, the drop called into question how sustainable recent job growth might be.