US: S&P 500 Index +2.4%, Dow +2.3%, Nasdaq +2.7%
Europe: STOXX Europe 600 +1.4%, German DAX +1.4%, France CAC 40 +0.5%, U.K. FTSE 100 +1.3%
Asia: Japan Nikkei +1.3%, China Shanghai Composite +2.3%, Korea KOSPI 0.7%
Rates/Commodities: 10-Year Treasury yield +2 basis points to 2.97%, WTI crude oil +3.1%, COMEX gold +0.5%
Widespread gains helped drive the S&P 500 Index back into positive territory on the year, though interest-rate sensitive sectors like utilities and telecommunications lagged the broad market as the benchmark 10-year Treasury yield (briefly) moved back above 3%. Energy stocks moved higher along with oil following President Trump’s announcement that the U.S. would withdraw from the Iran nuclear deal and begin reinstating previously waived sanctions. That news, along with Tuesday’s Energy Information Administration report showing a drop in U.S. oil inventories, helped to push WTI crude prices above $70 per barrel for the first time since 2014. Economic data continued last week’s not-too-hot and not-too-cold trend, which should keep the Federal Reserve on its current rate-hike path of two to three more increases this year.
Overseas indexes enjoyed similarly strong performance, though emerging markets equities lagged notably as the dollar strengthened and U.S. bond yields remained near recent highs. However, according to LPL Chief Investment Strategist John Lynch, “While volatility may remain elevated in the near term, strong economic growth, generally accommodative monetary policies, and the potential currency-related export boost support our preference for emerging markets over developed foreign stocks for international equity allocations.”
Retail sales, industrial production, and the Leading Economic Indicators Index are among the key U.S. economic data due out next week; while Baker Hughes’ weekly rig count should garner attention as traders continue to monitor the U.S. production response to higher prices. Elsewhere, inflation and first quarter gross domestic product data releases are slated for the Eurozone, Germany, and Japan. Eurozone trade balance figures and Germany’s ZEW Economic Sentiment report will also be on investors’ radars.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.
All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. All performance referenced is historical and is no guarantee of future results.
Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.
This research material has been prepared by LPL Financial LLC.
To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL Financial LLC is not an affiliate of and makes no representation with respect to such entity.
The investment products sold through LPL Financial are not insured deposits and are not FDIC/NCUA insured. These products are not Bank/Credit Union obligations and are not endorsed, recommended or guaranteed by any Bank/Credit Union or any government agency. The value of the investment may fluctuate, the return on the investment is not guaranteed, and loss of principal is possible.
For Public Use— Tracking # 1-729730 (Exp. 05/19)