Weekly Economic Update: April 16, 2018

The Markets (as of market close April 13, 2018)
Surging energy stocks led a market rebound last week as each of the major benchmark indexes posted gains. Although stocks closed higher by week’s end, volatility continued to be the norm during the week as investors remain uneasy amidst the turbulent political climate. The trade war rhetoric may have been replaced by escalating strife in Syria.  As you hear us often say at BWFA, the news outlets make their money by creating provocative news items that create intrigue- their job is not to make you money or help you achieve your long term financial goals and objectives.
The Nasdaq climbed the highest, followed by the Russell 2000. The large caps of the S&P 500 and the Dow each posted strong gains of almost 2.0%.  The price of crude oil soared last week and the price of gold rose.
  • According to the latest report from the Bureau of Labor Statistics, the Consumer Price Index actually fell 0.1% after increasing 0.2% in February. Over the last 12 months, the CPI has risen 2.4%. A closer look at prices reveals that a decline in gasoline prices more than offset increases in prices for shelter, medical care, and food.
  • Wholesale (producer) prices for both goods and services rose in March and for the last 12 months, producer prices have advanced 3.0%. April should have a surplus as income taxes for 2017 provide a boost to government receipts.
  • The government’s deficit was $208.7 billion in March, following a deficit of $215.2 billion in February.
  • The price index for goods imported into the United States showed no change in March compared to February.
  • There were 6.1 million new job openings in February, down slightly from the 6.2 million openings the prior month. Over the 12 months ended in February, hires totaled 65.6 million and separations totaled 63.3 million, yielding a net employment gain of 2.3 million.


Another indicator of inflationary trends is the retail sales report, which is out this week. In February, retail sales fell 0.1% due, primarily, to a drop in auto sales. However, motor vehicle sales are expected to show improvement in March, and sales overall are expected to increase as well.