The Dow Jones Industrial Average (DJIA) rose 46 points (0.2%) to 23,979, the S&P 500 Index added 9 points (0.3%) to 2,613, and the NASDAQ Composite increased 35 points (0.5%) to 6,950. In moderate volume, 799 million shares were traded on the NYSE and 2.1 billion shares changed hands on the NASDAQ. WTI crude oil was $1.36 higher at $63.42 per barrel and wholesale gasoline gained $0.03 to $1.98 per gallon. Elsewhere, the Bloomberg gold spot price added $3.91 to $1,336.94 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was nearly 0.3% lower at 89.87.
Treasuries were mixed as the economic calendar was void of any major releases today, with the yield on the 2-year note rising 2 basis points (bps) to 2.27%, the yield on the 10-year note unchanged at 2.79%, while the 30-year bond rate declined 1 basis point to 3.02%.
The treasury yield curve steepened a bit last week and the U.S. dollar nudged higher as volatility for the equity markets remained elevated amid festering trade concerns, the recent scrutiny on the tech sector and with the economic backdrop remaining solid. This week, Fed monetary policy could nudge its way back into focus and be a source of heightened volatility, courtesy of March inflation statistics in the form of the Consumer Price Index (CPI) and the Import Price Index, as well as tomorrow’s Producer Price Index (PPI), forecasted to show prices at the wholesale level inched 0.1% higher month-over-month (m/m) for March, while the core rate, which excludes food and energy, is expected to have gained 0.2% m/m. Moreover, the Fed will release the minutes from its March meeting that paired together an expected rate hike and a slightly more hawkish tone. Adding another layer of potential volatility, Q1 earnings season set to unofficially kick off toward the end of the week, with a heavy emphasis on the financial sector. Earnings growth is estimated at 17.1% year-over-year, which would be the highest pace since Q1 2011, per data compiled by FactSet.
Schwab Center for Financial Research – Market Analysis Group
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