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Weekly Market Update – March 31, 2017

The Dow finished down on Friday, sliding 65 points to close at 20,663.  For the week, the Dow was up 0.3% (S&P 500 +0.8%) and year-to-date is now up 4.6% (S&P 500 +5.5%).  The yield on the 10-year Treasury fell 3 bps Friday to 2.39%, ending the week down 2 bps.  

US economic data was favorable this week.  The Conference Board’s Consumer Confidence Index rose to 125.6, above forecasts of 114 and now at the highest level since 2000.  Pending home sales were strong, up 5.5% y/y.  The Chicago manufacturing PMI looked good at 57.7 vs. the prior 57.4 reading.  And initial jobless claims of 258k were above expectations of 247k, but down sequentially from 261k.  US equity flows were negative for a second straight week; however, Technology, Energy, and Financials all saw inflows – sectors that we currently hold a positive bias towards.  Bonds continue to see inflows.

In policy news, the Administration began rolling back Obama environmental executive orders, issued orders aimed at foreign trade abuses, and communicated a more modest approach to reworking the NAFTA trade agreement.  Tax reform is currently front and center among the White House and legislators.

Next week’s economic calendar will be quite busy, with ISM manufacturing and US auto sales on Monday (4/3), factory and durable goods orders Tuesday (4/4), and the big March employment report on Friday (4/7).  The employment report is typically a significant market mover, and this month payrolls are expected to rise by 180k, the unemployment rate is expected to remain steady at 4.7%, and average hourly earnings growth is expected to remain around +2.7% y/y. 

Have a great weekend!


Ulland Investment Advisors

4550 IDS Center · Eighty South Eighth Street · Minneapolis MN 55402 · Telephone: 612-312-1400 · Facsimile: 612-204-3464