Telemus Weekly Market Review

April 24 – 28, 2017

The markets continued their winning ways this week. The S&P500 gained 1.51%, the Dow 1.91% and the Nasdaq was the star performer gaining 2.32% on the back of strong earnings from Alphabet/Google and Amazon late in the week.

On Sunday the French people narrowed their presidential race to two candidates –Emmanuel Macron and Marine Le Pen–with the results fueling a buying frenzy around the world on Monday. According to the most recent polls, Mr. Macron, who is a proponent of tighter European Union (EU) integration, has a comfortable advantage over Ms. Le Pen, who would like to conduct a French referendum on Eurozone membership, leading investors to believe the EU has dodged the latest populist bullet. The run-off will be conducted on Sunday, May 7th.

Buyers took center stage again on Tuesday in an encore performance that left the S&P 500 higher by 1.7% after the first two sessions of the week. The positive sentiment surrounding the French vote lingered, but earnings were the focal point with Dow components Caterpillar, McDonald’s, and DuPont feeding the bulls with better than expected top and bottom line numbers.

However, the stock market hit a proverbial speed bump on Wednesday amid the unveiling of President Trump’s much anticipated tax outline. The general framework of the plan was encouraging to investors, but specific details, like how it will be paid for, were in short supply. Without any offsetting sources of revenue, the tax cuts will most likely add to the budget deficit, which will be a difficult pill for some conservative lawmakers to swallow.

Range-bound trading action continued throughout the remainder of the week as investors responded to upbeat earnings reports with caution, hesitant to extend the stock market’s already solid 2017 gain amid disappointing first quarter GDP growth of 0.7%. In addition, continued geopolitical tension related to North Korea weighed on investor sentiment.

In the end, the stock market’s early-week rally more than made up for the second-half slump. The upbeat sentiment also led to an increase in rate-hike expectations. The fed funds futures market points to the June FOMC meeting as the most likely time for the next rate-hike announcement with an implied probability of 66.6%, up from last week’s 48.5%. The yield on the 10 year U.S. Treasury note rose slightly last week to close at 2.28%.

Crude oil closed Friday at 49.19 down from just below $50 the previous week.

May 1 – 5 Economic Calendar

  • Monday
  • Personal Income and Outlays
    8:30 AM ET
  • PMI Manufacturing Index
    9:45 AM ET
  • ISM Mfg Index
    10:00 AM ET
  • Construction Spending
    10:00 AM ET
  • Gallup US Consumer Spending Measure
    2:00 PM ET
  • Motor Vehicle Sales
    8:00 PM ET
  • EIA Petroleum Status Report
    10:30 AM ET
  • FOMC Meeting Announcement
    2:00 PM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
  • Tuesday
  • Gallup US ECI
    8:30 AM ET

  • Redbook
    8:55 AM ET
  • ISM Mfg Index
    10:00 AM ET
  • Construction Spending
    10:00 AM ET
  • Gallup US Consumer Spending Measure
    2:00 PM ET
  • Motor Vehicle Sales
    8:00 PM ET
  • EIA Petroleum Status Report
    10:30 AM ET
  • FOMC Meeting Announcement
    2:00 PM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
  • Wednesday
  • MBA Mortgage Applications
    7:00 AM ET
  • ADP Employment Report
    8:15 AM ET
  • Gallup U.S. Job Creation Index
    8:30 AM ET
  • Treasury Refunding Announcement
    8:30 AM ET
  • PMI Services Index
    9:45 AM ET
  • ISM Non-Mfg Index
    10:00 AM ET
  • EIA Petroleum Status Report
    10:30 AM ET
  • FOMC Meeting Announcement
    2:00 PM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
  • Thursday
  • Challenger Job-Cut Report
    7:30 AM ET

  • International Trade
    8:30 AM ET
  • Jobless Claims
    8:30 AM ET
  • Productivity and Costs
    8:30 AM ET
  • Gallup Good Jobs Rate
    8:30 AM ET
  • Bloomberg Consumer Comfort Index
    9:45 AM ET
  • Factory Orders
    10:00 AM ET
  • EIA Natural Gas Report
    10:30 AM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
  • Friday
  • Employment Situation
    8:30 AM ET
  • Stanley Fischer Speaks
    11:30 AM ET
  • John Williams Speaks
    12:45 PM ET
  • Baker-Hughes Rig Count
    1:00 PM ET
  • Janet Yellen Speaks
    1:30 PM ET
  • James Bullard, Charles Evans, Eric Rosengren Speak
    1:30 PM ET
  • Consumer Credit
    3:00 PM ET
  • FOMC Meeting Announcement
    2:00 PM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET

PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS. This market commentary is a matter of opinion and is for informational purposes only.  It is not intended as investment advice and does not address or account for individual investor circumstances.  Investment decisions should always be made based on the client’s specific financial needs, goals and objectives, time horizon and risk tolerance.  The statements contained herein are based solely upon the opinions of Telemus Capital, LLC.  All opinions and views constitute our judgments as of the date of writing and are subject to change at any time without notice. Information was obtained from third party sources, which we believe to be reliable, but not guaranteed.