The Week On Wall Street
Despite a historic downturn in employment, stocks managed to climb higher last week as investors were emboldened by the pace of economic re-openings here and abroad.
The Dow Jones Industrial Average gained 2.56%, while the Standard & Poor’s 500 advanced 3.50%. The Nasdaq Composite Index jumped 6.00% for the week. The MSCI EAFE Index, which tracks developed overseas stock markets, slipped 1.09%.1,2,3
Tech Stocks Power Nasdaq
Last week’s trading was driven by a crosscurrent of emotions — worries about weak corporate earnings and pace of business re-openings as well as optimism over the pickup in economic activity and progress on developing a vaccine.
Stocks posted back-to-back daily gains to end the week despite troubling employment data. Perhaps the headline of the week was that the technology-heavy NASDAQ Composite Index moved into positive territory year-to-date.1,2
A “Silver Lining” In The Jobs Report?
Last week brought into stark focus the number of jobs lost since the start of the economic shutdown. Since mid-March, unemployment insurance claims have reached 33.5 million. The pace of newly unemployed has slowed down, however, with recent weeks at about half the rate at the peak in late March.4,5
April’s employment report, released on Friday, saw a spike to 14.7% in the unemployment rate. As severe as these numbers are, 88% of April’s newly unemployed characterized their job loss as temporary rather than permanent, as opposed to 47% of the newly unemployed in March who said their job loss was temporary.6,7
The Week Ahead: Key Economic Data
- Tuesday: Consumer Price Index.
- Thursday: Jobless Claims.
- Friday: Retail Sales; Industrial Production.
The Week Ahead: Companies Reporting Earnings
- Monday: Under Armour (UAA), Simon Property (SPG), Caesars Entertainment (CZR).
- Wednesday: Cisco Systems (CSCO).
|Market Index||Close May 8||Week %||YTD %|
|Treasury||Close May 8||Week %||YTD %|
|10 Year Note||0.69%||+0.05||-1.23|
Sources: wsj.com, treasury.gov – 5/8/2020
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. Weekly and year-to-date market index returns are expressed as percentages. 10-year Treasury note yield = projected return on investment, expressed as a percentage, on the U.S. government’s 10-year bond. Weekly and year-to-date 10-year Treasury note yield differences are expressed in basis points.