U.S. and World News
- The Federal Reserve met this week and decided to keep interest rates unchanged, a result which was expected by markets and forecasters. The Fed indicated a more cautious approach to future monetary policy and lowered its internal projections to just two interest rate hikes in 2016, down from the four projected to begin the year. Fed officials pointed to global economic and financial developments as the cause for their concern and noted that while inflation has picked up in recent months, it remains below the committee’s long-run objective.
- President Obama has nominated Judge Merrick Garland to the Supreme Court following the death of long-serving conservative Justice Antonin Scalia. Merrick would be the 113th Supreme Court justice if confirmed. Standing in his way however, is the Republican controlled Senate which has vowed to not hold any confirmation hearings for any Obama nominee as they believe that the seat should be filled by the next president following this year’s election.
- Markets continued to rally this week and have broken into positive territory for 2016. The S&P 500 added 1.37% and closed at 2,050. Likewise, the Dow Jones rose 2.26% and closed at 17,602. So far in 2016, the S&P is up 0.80% and the Dow is up 1.72%.
- Interest rates fell amid the rally in equity markets this week. The 5 year and 10 year U.S. Treasury Notes are now yielding 1.39% and 1.88%, respectively.
- The spot price of WTI Crude Oil gained 2.21% this week to close at $39.35 per barrel. WTI Crude has risen 0.56% in 2016.
- The spot price of Gold increased 0.48% this week, closing at $1,255.40 per ounce. Year to date, gold prices are up 18.31%.
- Initial jobless claims came in at 265,000 which was an increase from last week’s reading of 259,000. The Labor Department noted no special factors in the data. The four week moving average for claims moved slightly up to 268,000.
- Retail sales declined by -0.1% in February, in line with forecasts, reflecting lower vehicle and gas station sales. Core retail sales (excludes gas and autos) were unchanged in February, lower than forecasts of a 0.2% increase. Additionally, core retail sales during the prior two months were revised down -0.3%, adding to an overall disappointing report.
- Consumer Price Index (measure of inflation) declined by -0.2% in February, in line with forecasts. This was largely due to a -6% decline in energy prices during the month. Headline inflation is now up 1.0% over the last 12 months.
- Core CPI (excludes food and energy costs) rose by 0.3%, better than expectations of 0.2%. This brings the increase of core prices to 2.3% over the last 12 months.
Fact of the Week
- The exchange traded fund (ETF) industry has grown from 80 funds in the year 2000 to now 1,603 funds today managing over $2.1 trillion in assets. (Source: Strategas Research Partners)
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