In a week marked by four large daily moves, the S&P 500 had an up week closing at 5,525. Monday turned sour after Trump posted that the economy would slow if the Fed did not cut interest rates and called for Fed Chair Powells termination. As such, the S&P 500 gapped down at the open and finished the session with a daily loss of over 2%. On Tuesday we returned to tariff talk when Treasury Secretary Bessent hinted at the possibility of de-escalation in the trade war with China. Boosted by this news, the S&P 500 gapped up at the open and recouped all of Mondays losses plus some with a daily gain of over 2%. On Wednesday we saw a softening of Trumps Monday comments, stating that he doesnt plan to remove Chairman Jerome Powell and also signaled that tariffs on Chinese imports may go down. The S&P 500 gapped up at the open, accounting for the majority of Wednesdays daily gain of over 1%. Thursday was dominated by tariff negotiation talk when China said there were no trade talks taking place, damping the optimistic administration view. However, that did not dampen the markets bullishness as the S&P 500 notched another 2% daily gain. On Friday the UMICH Consumer Sentiment Survey number came in at 52.2, its biggest three-month slide since the 1990 recession. On inflation, the one-year outlook was 6.5%, making it the highest reading since November 1981. What was unusual about Friday was that while the S&P 500 was gaining strength throughout the session, it was the only day of the week with a daily move of less than 1%. On the technical side lets look at a bullish signal that has only flashed 19 times since 1943, that being the Zweig Breadth Thrust Indicator. It measures broad stock market participation in an ongoing rally, and while the mechanics can be found on the web, the results have been outstanding. On average, the S&P 500 has gained 14.8% in 6 months and 23.4% in 12 months after those 19 buy signals. What makes it stand out is that there has never been a negative 6 or 12 month return in any of those 19 previous instances. That said, this indicator gave a buy signal for a 20th time on Thursday, which would get the S&P 500 to 6,296 in October and 6,768 next April. For next week we get the Core PCE Inflation number on Wednesday followed by Fridays Jobs and Employment numbers. Earnings season also continues with Microsoft, Meta, Apple and Amazon reporting mid-week. For TSP TIPS we moved into the International fund last Monday, and it still sits at the top of the Composite Score and Performance Ranking leaderboards. While all three equity funds (C/S/I) had positive weeks, the I fund was the only one with a positive return on all five days. We are also seeing improvements across the board in Performance Rankings (PR), and that should continue as the one-month return makes up 40% of the PR formula. Looking back a month, on Wednesday 2 April the S&P 500 closed at 5,670, and four trading days later, on Tuesday 8 April, it closed at 4,982 for a loss of over 12%. As we move into the beginning of May next week and those beginning of April days get kicked out, the PR will continue to improve, and we will most likely see a rotation into new funds. As always, well monitor market behavior and will most likely recommend a new investment mix as we move into May.
In a week marked by four large daily moves, the S&P 500 had an up week closing at 5,525. Monday turned sour after Trump posted that the economy would slow if the Fed did not cut interest rates and called for Fed Chair Powells termination. As such, the S&P 500 gapped down at the open and finished the session with a daily loss of over 2%. On Tuesday we returned to tariff talk when Treasury Secretary Bessent hinted at the possibility of de-escalation in the trade war with China. Boosted by this news, the S&P 500 gapped up at the open and recouped all of Mondays losses plus some with a daily gain of over 2%. On Wednesday we saw a softening of Trumps Monday comments, stating that he doesnt plan to remove Chairman Jerome Powell and also signaled that tariffs on Chinese imports may go down. The S&P 500 gapped up at the open, accounting for the majority of Wednesdays daily gain of over 1%. Thursday was dominated by tariff negotiation talk when China said there were no trade talks taking place, damping the optimistic administration view. However, that did not dampen the markets bullishness as the S&P 500 notched another 2% daily gain. On Friday the UMICH Consumer Sentiment Survey number came in at 52.2, its biggest three-month slide since the 1990 recession. On inflation, the one-year outlook was 6.5%, making it the highest reading since November 1981. What was unusual about Friday was that while the S&P 500 was gaining strength throughout the session, it was the only day of the week with a daily move of less than 1%. On the technical side lets look at a bullish signal that has only flashed 19 times since 1943, that being the Zweig Breadth Thrust Indicator. It measures broad stock market participation in an ongoing rally, and while the mechanics can be found on the web, the results have been outstanding. On average, the S&P 500 has gained 14.8% in 6 months and 23.4% in 12 months after those 19 buy signals. What makes it stand out is that there has never been a negative 6 or 12 month return in any of those 19 previous instances. That said, this indicator gave a buy signal for a 20th time on Thursday, which would get the S&P 500 to 6,296 in October and 6,768 next April. For next week we get the Core PCE Inflation number on Wednesday followed by Fridays Jobs and Employment numbers. Earnings season also continues with Microsoft, Meta, Apple and Amazon reporting mid-week. For TSP TIPS we moved into the International fund last Monday, and it still sits at the top of the Composite Score and Performance Ranking leaderboards. While all three equity funds (C/S/I) had positive weeks, the I fund was the only one with a positive return on all five days. We are also seeing improvements across the board in Performance Rankings (PR), and that should continue as the one-month return makes up 40% of the PR formula. Looking back a month, on Wednesday 2 April the S&P 500 closed at 5,670, and four trading days later, on Tuesday 8 April, it closed at 4,982 for a loss of over 12%. As we move into the beginning of May next week and those beginning of April days get kicked out, the PR will continue to improve, and we will most likely see a rotation into new funds. As always, well monitor market behavior and will most likely recommend a new investment mix as we move into May.