ClearWater Market Commentary as of April 26th, 2021

Here is the ClearWater Market Commentary as of April 26th, 2021:

In this issue:
– Performance of Major Indices
– Market Commentary
– Last Week’s Key Economic  
  Events and Upcoming Events

Performance of Principle Indexes: 

^{As of 2021/04/23 – Source: www.marketwatch.com}

^{As of 2021/04/23}

Last week’s and next week’s key economic events:
 

US economy (S&P 500 -0.13%):

• Stock markets came under pressure from renewed worries that rising global COVID-19 cases will delay the full recovery of economic activity.
• The growing pessimism overshadowed the positive economic data and better-than-expected corporate earnings report. However, current data still reinforced the view that the economic recovery so far has been much more robust than expected.
• A White House proposal to increase capital gains tax added to the pressure on stock prices.
• Applications for unemployment insurance dropped to a new pandemic low.
• The energy sector led the S&P’s declining sectors, as rising US crude inventories and talk of potential sanctions relief in Iran nuclear talks added to the pressure on oil prices.

Canadian markets (S&P/TSX -1.29%):

• Canadian housing starts in March were the strongest since the data began in 1990.
• The Bank of Canada raised its forecast of Canada’s first quarter Gross Domestic Product growth to 7%.
• The Bank of Canada also held its benchmark rate state at last weeks meeting, but reduced its bond purchase program by one-quarter and shortened its expected timeline for potential interest-rate hikes.
• In scaling back its quantitative easing, the Bank of Canada became the first major central bank to move towards exiting from stimulus.
• The decline in the S&P/TSX Composite Index was led by the information technology, industrials, and energy sectors.

Performance 2021: S&P 500/400/600 Sectors

European and Asian economies:

• Most European and Asian markets were lower amid concerns on the rising coronavirus caseload.
• The European Central Bank (ECB) kept its interest rates unchanged and confirmed a significantly faster pace of bond purchases, as it had previously announced.
• European PMI (Purchasing Managers’ Index) was stronger than expected and business activity in the manufacturing sector rose to a record high, and the services portion of the economy unexpectedly returned to growth, despite the introduction of new restrictions aiming to curb the coronavirus’ spread.
• Sentiment in Europe was set back when the US State Department boosted its ‘Don’t Not Travel’ guidance to about 80% of countries worldwide.
• Chinese stocks rose all week as mainland equity markets received the third-largest single-day inflow of cash from Hong Kong investors.
• New rules from China’s financial regulators appear to have lifted investor sentiment as well.
• Tensions between Russia and its neighbour Ukraine remained elevated which put pressing on Russian assets.
• Japan was among the weakest major equity markets, as the government planned another state of emergency which could push the country back into recession.

What to watch this week:

Canada

• Retail sales (February)
• Gross Domestic Product (February)
• Industrial Product, Raw Materials Price Indices (March)

U.S.

• Federal Reserve interest rate decision (April 28)
• Durable goods orders (March)
• Conference Board Consumer Confidence Index (April)
• Gross Domestic Product (1^st Quarter)
• Pending home sales (March)
• Personal income and spending (March)
• Univ. of Michigan Consumer Sentiment Index (April)

Sources: Bloomberg.com,Yardeni.com, Barron’s.com, Factset.com and Newyorkfed.org

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