Financial News and Portfolio Management Discussion through May 7th

US stocks ended a volatile week, which saw both the largest daily gain and daily decline of the year, slightly lower. The S&P 500 and Dow both ended the week 0.2% lower. Foreign markets sharply declined with the FTSE All World Ex US down 3.0% for the week. Markets focused on the actions central banks are taking to get inflation under control and their comments on how aggressive they will be in the future. US crude ended the week at $109.77 per barrel up from $104.69 the week prior. The 10-year Treasury yield rose to 3.03% up from 2.94% the week prior. The yield on the benchmark 10-year Treasury note rose above 3% for the first time since November 2018.

The Fed approved a half percent rate increase, the largest in over two decades, and plans to reduce its asset portfolio. Fed officials broadly agree that additional half percentage point increases may be warranted in upcoming meetings. Officials are not actively discussing a larger three quarter of a percent increase. The Fed plans on shrinking its asset holding passively by allowing bonds to mature without reinvesting the proceeds into new securities rather than by selling them in the open market.

The U.S. economy added 428,000 jobs in April above the consensus estimate of 395,000. The unemployment rate remained at 3.6%.

The Bank of England raised its key rate to 1% from 0.75%, the fourth time its raised rates in as many meetings. The BOE signaled it is likely to move cautiously as worries grow over the possibility of a recession.

There is no guarantee that any investment strategy, including those described here, will be successful. Any investment or investment strategy can lose money. Past performance does not guarantee or predict future results. You should not assume that any discussion or information contained herein serves as the receipt of, or as a substitute for, personalized investment advice from Raffa Wealth Management, LLC. This information was gathered from reliable sources, but we cannot guarantee accuracy. Indexes do not reflect the fees associated with actual investments and such fees would reduce the performance illustrated. Source: FMG Suite, LLC.
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