Weekly Market Update, April 11, 2016

Presented by Mark Gallagher

General market news
• The 10-year Treasury opened with a yield of 1.69 percent early Monday morning; it had reached almost 2 percent a little less than four weeks ago. Over that same time period, the 30-year came down from a recent high of 2.75 percent to a low of 2.50 percent late last week. The 30-year opened slightly higher Monday morning at 2.55 percent.
• The S&P 500 closed within striking distance of all-time highs to start April, but the wind came out of the sails and the index retreated 1.15 percent last week. While it often goes unnoticed when the market is surging higher, there has certainly been increased volatility the last two months, with large weekly moves in both directions. With earnings season kicking off this week, this is a trend that could continue.
• Economic news was thin last week, with reports largely confirming some expected weakness in factory orders last February but better-than-expected activity in the ISM Non-Manufacturing Index.


Equity Index Week-to-Date Month-to-Date Year-to-Date 12-Month
S&P 500 –1.15% –0.53% 0.81% 0.50%
Nasdaq Composite –1.27% –0.36% –2.74% –0.73%
DJIA –1.15% –0.55% 1.64% 0.77%
MSCI EAFE –0.39% –2.54% –5.33% –12.26%
MSCI Emerging Markets –2.00% –3.23% 2.28% –18.48%
Russell 2000 –1.81% –1.48% –2.99% –11.82%

  Source: Bloomberg


Fixed Income Index Month-to-Date Year-to-Date 12-Month
U.S. Broad Market 0.33% 3.38% 2.26%
U.S. Treasury 0.39% 3.61% 2.92%
U.S. Mortgages 0.12% 2.10% 2.50%
Municipal Bond 0.61% 2.29% 4.60%

  Source: Morningstar Direct


What to look forward to
We focus on inflation readings this week, with releases of both Consumer and Producer Price Index data.

Retail Sales are expected to have rebounded in March, while Industrial Production is expected to have remained low.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Barclays Capital Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Barclays Capital Mortgage-Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Barclays Capital Municipal Bond Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million.
Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave. Suite #304, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.
Authored by the Investment Research team at Commonwealth Financial Network.

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