It was a wild, volatile and historic week for the markets as the S&P 500 broke a streak of two down weeks, closing Friday up at 5,363. On Monday the S&P500 gapped down at the open and immediately fell 4.7% into bear market territory, down 20% from its 19 February record close. However, it was short lived as it reversed to the upside before closing with a minor loss. Tuesday was just the opposite of Monday as the S&P 500 gapped up at the open and rallied as much as 4% on signs that Trump was open to negotiating trade deals. However, that was also short lived with the White House pressing ahead with China retaliation tariffs. At the close, the S&P 500 notched a daily loss of greater than 1% and closed below the 5,000 level for the first time since 19 April 2024. Wednesday was wild after Trump announced a temporary drop in tariff rates for most countries to 10% for 90 days. It was also historic in that the S&P 500 soared more than 9%, seeing its third-largest daily gain since World War II. As a side note, the higher days were 11.58% and 10.79% on 13 and 28 October 2008 respectively, during the 2008 financial crisis. Trading volume of around 30 billion shares was also historic, at the highest-level dating back 18 years. Before Thursdays open the Core Consumer Price Index came in beating both monthly and annual expectations. March Core CPI was 0.1%, its lowest monthly gain since June 2024, while the 2.8% annual rate marked the lowest rate since March 2021. However, tariff fears again took the spotlight, and the S&P 500 had its third straight day of moves greater than 1%, score 2 down, 1 up. Before Fridays open and similar to Core CPI, the Core Producer Price Index (PPI) also beat monthly and annual expectations. March Core PPI declined by 0.1%, reflecting the first decrease in eight months, while the annual Core PPI eased to 3.3%, the lowest reading since last September. This good news was then tempered by the UMICH April consumer sentiment numbers which came in worse than forecast. Expected annual inflation leaped to 6.7%, its highest level since November 1981. However, stocks took a leg higher Friday afternoon on the Presidents comments that he is optimistic China will seek a deal with the U.S. And with that came a daily gain of greater than 1%, evening the 4 day score at 2 up and 2 down. At Fridays closing bell the S&P 500 was up 5.7% for the week, having its best week since the first week of November 2023. As we always like to do, lets take a closer look. On Friday 3 November 2023 the S&P 500 closed at 4,358, up 5.85% from the Friday 27 October 2023 close of 4,117. But lets look back to the previous S&P 500 high. On 31 July 2023 the S&P 500 peaked at 4,588, and on 27 October 2023 the low was 4,117, so the S&P 500 lost 10.3%. And then we have the bounce back, with the S&P 500 gaining 5.85% for the week ending 3 November 2023. So what happened next? The S&P 500 had eight straight weeks of gains, that being 1.31%, 2.29%, 1.00%, 0.77%, 0.21%, 2.49%, 0.75% and 0.32%. That brought us to 4,769 on Friday 29 December 2023 for a total gain of 9.44%. So, lets look forward to the present. A gain of 9.44% over the next eight weeks would give us 5,869 for the S&P 500 on Friday 13 June 2025. While no one can predict the future, we can say its been done before. For next week the economic news is light, but it is also the first full week of earnings season. And then we have tariffs, which hopefully will see some negotiation and reconciliation with China. For TSP TIPS we remain cautious as the three equity funds (C/S/I) all have negative Performance Rankings and low Composite Scores. However, with last weeks extreme volatility, well remain poised to return to equities should the funds trigger buy criteria. And with one investment mix remaining in April, that investment mix allocation could shift significantly to equities. That said, stand by for a mid-week alert if the S&P 500 starts a post 5% up week bullish move similar to 2023.
It was a wild, volatile and historic week for the markets as the S&P 500 broke a streak of two down weeks, closing Friday up at 5,363. On Monday the S&P500 gapped down at the open and immediately fell 4.7% into bear market territory, down 20% from its 19 February record close. However, it was short lived as it reversed to the upside before closing with a minor loss. Tuesday was just the opposite of Monday as the S&P 500 gapped up at the open and rallied as much as 4% on signs that Trump was open to negotiating trade deals. However, that was also short lived with the White House pressing ahead with China retaliation tariffs. At the close, the S&P 500 notched a daily loss of greater than 1% and closed below the 5,000 level for the first time since 19 April 2024. Wednesday was wild after Trump announced a temporary drop in tariff rates for most countries to 10% for 90 days. It was also historic in that the S&P 500 soared more than 9%, seeing its third-largest daily gain since World War II. As a side note, the higher days were 11.58% and 10.79% on 13 and 28 October 2008 respectively, during the 2008 financial crisis. Trading volume of around 30 billion shares was also historic, at the highest-level dating back 18 years. Before Thursdays open the Core Consumer Price Index came in beating both monthly and annual expectations. March Core CPI was 0.1%, its lowest monthly gain since June 2024, while the 2.8% annual rate marked the lowest rate since March 2021. However, tariff fears again took the spotlight, and the S&P 500 had its third straight day of moves greater than 1%, score 2 down, 1 up. Before Fridays open and similar to Core CPI, the Core Producer Price Index (PPI) also beat monthly and annual expectations. March Core PPI declined by 0.1%, reflecting the first decrease in eight months, while the annual Core PPI eased to 3.3%, the lowest reading since last September. This good news was then tempered by the UMICH April consumer sentiment numbers which came in worse than forecast. Expected annual inflation leaped to 6.7%, its highest level since November 1981. However, stocks took a leg higher Friday afternoon on the Presidents comments that he is optimistic China will seek a deal with the U.S. And with that came a daily gain of greater than 1%, evening the 4 day score at 2 up and 2 down. At Fridays closing bell the S&P 500 was up 5.7% for the week, having its best week since the first week of November 2023. As we always like to do, lets take a closer look. On Friday 3 November 2023 the S&P 500 closed at 4,358, up 5.85% from the Friday 27 October 2023 close of 4,117. But lets look back to the previous S&P 500 high. On 31 July 2023 the S&P 500 peaked at 4,588, and on 27 October 2023 the low was 4,117, so the S&P 500 lost 10.3%. And then we have the bounce back, with the S&P 500 gaining 5.85% for the week ending 3 November 2023. So what happened next? The S&P 500 had eight straight weeks of gains, that being 1.31%, 2.29%, 1.00%, 0.77%, 0.21%, 2.49%, 0.75% and 0.32%. That brought us to 4,769 on Friday 29 December 2023 for a total gain of 9.44%. So, lets look forward to the present. A gain of 9.44% over the next eight weeks would give us 5,869 for the S&P 500 on Friday 13 June 2025. While no one can predict the future, we can say its been done before. For next week the economic news is light, but it is also the first full week of earnings season. And then we have tariffs, which hopefully will see some negotiation and reconciliation with China. For TSP TIPS we remain cautious as the three equity funds (C/S/I) all have negative Performance Rankings and low Composite Scores. However, with last weeks extreme volatility, well remain poised to return to equities should the funds trigger buy criteria. And with one investment mix remaining in April, that investment mix allocation could shift significantly to equities. That said, stand by for a mid-week alert if the S&P 500 starts a post 5% up week bullish move similar to 2023.