Market Data as of Week Ending: 4/9/2021 unless noted otherwise
U.S. stock markets surged to record highs last week as the bullish theme of robust economic and earnings growth in 2021 remains intact. Investors rotated into quality consumer and tech companies from reopening themes as Treasury yields came under some pressure making growth companies more attractive. Small and medium sized companies lagged their large company peers while value stocks underperformed growth. Sectors that tend to be more cyclical and sensitive such as consumer discretionary and information technology outperformed with gains in each sector. Energy lagged the broader market as oil prices fell after OPEC+ announced it would start to gradually increase supplies later this spring. Developed foreign stocks in Europe and Asia underperformed U.S stocks and Emerging Market stocks lagged developed foreign markets.
U.S. Treasury yields declined slightly and ended the week at 1.66% as COVID-19 uncertainties persist and the Fed reaffirmed their accommodative stance. Long duration high yield bonds were the best performing asset class while short-term government bonds were the worst performing asset class but still managed to deliver a small gain. Investment grade corporate bonds ended the week yielding nearly 2.3% and high yield corporate bonds are yielding just over 4.8%.
Economic data released during the week was mixed but was overall more positive as several key reports surprised to the upside. The U.S. service economy surged in March with the ISM survey jumping to 63.7%, as Americans gained more confidence to go out. U.S payrolls increased the most since August as the Labor Department reported that employers added 916,000 jobs in March, well above the estimated 650,000. Jobless claims, however, increased for the second consecutive week as the total filed through the states was 744,000 last week. The producer price index rose 1% in March, the largest annual increase since 2011. Economic data from China’s Qingming holiday weekend resembled pre-pandemic levels as box office and cinema admissions set new records.