Stocks Close Mixed But Decline For The Week…..

U.S stocks closed mixed on the day and rounded out the first full week of the quarter with a weekly decline. Uneasiness and trepidation appeared to drive a relatively quiet session as investors continued to weigh the potential implications of a highly aggressive Fed monetary policy tightening cycle. Meanwhile, the ongoing war in Ukraine still hung over the markets, after this week brought about fresh sanctions on Russia by the U.S. and European Union. The Treasury yield curve continued to be a key theme for investors after this week’s steepening that reversed an inversion of a key portion of the curve that sparked recession chatter. Treasury yields rose again today as Treasuries extended losses. The U.S. dollar added to a solid weekly gain, while crude oil prices rose after seeing some recent pressure, and gold gained ground. Equity news was light ahead of next week’s ramp up of Q1 earnings season, but WD-40 topped quarterly expectations after yesterday’s closing bell. The economic calendar was also quiet, though wholesale inventories continued to climb. Asia finished higher to close out the week, and Europe rebounded from yesterday’s downside reversal, as Thursday’s afternoon resiliency in the U.S. appeared to provide a positive lead in.

The Dow Jones Industrial Average rose 138 points (0.4%) to 34,721, the S&P 500 Index lost 12 points (0.3%) to 4,488, and the Nasdaq Composite decreased 186 points (1.3%) to 13,711. In moderate volume, 4.0 billion shares of NYSE-listed stocks were traded, and 4.4 billion shares changed hands on the Nasdaq. WTI crude oil rose $2.23 to $98.26 per barrel. Elsewhere, the gold spot price traded $7.80 higher to $1,945.60 per ounce, and the Dollar Index was 0.1% higher at 99.84. Markets were lower for the week, as the DJIA was down 0.3%, the S&P 500 lost 1.3%, and the Nasdaq Composite decreased 3.9%.

The equity markets remained choppy this week, giving back some of a recent rally off of the March 8 lows that took the S&P 500 out of traditional correction territory—at a 10% drop from a recent high—and rescued the Nasdaq from a bear market—at least a 20% drawdown from a recent high. The markets continued to contend with the ongoing war between Russia and Ukraine, and expectations that the Fed is set to get aggressive with its monetary policy tightening campaign to try to tame elevated inflation pressures. The markets were defensive this week, with strength in the Health Care, Consumer Staples, and Utilities sectors being more than offset by weakness in heavyweight growth sectors, led by Information Technology, Consumer Discretionary, and Communications Services.

The Financials sector also saw pressure despite the noticeable rise in Treasury yields as the markets seemed to contemplate the implications of an expected highly aggressive Fed monetary policy campaign.

Treasuries were lower to extend a recent drop that has seen rates jump and the yield curve steepen. The yield curve spread has garnered heavy attention, with some portions inverting earlier this month to foster talk of the potential for a recession on the horizon. However, this week’s action saw the yield curve steepen with a key portion—spread between 2-year and 10-year yields—moving out of inversion territory, with the yield on the 10-year note hitting three-year highs.

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