Equity Markets Closed Lower Last Week

Equities generally closed lower by the end of the week, with the Nasdaq and the Dow falling furthest among the major benchmark indexes. The Russell 2000 and the Global Dow were flat. Investors spent the week assessing the first-quarter gross domestic product, jobless claims and corporate earnings data. Ten-year Treasury yields rose as bond prices dipped on hawkish comments from Federal Reserve officials and a weaker Treasury auction. Crude oil prices decreased, and prices at the pump were lower. Utilities led the market sectors, with energy and real estate outperforming. Health care, industrials and information technology closed in the red.

GDP Growth Was Slower in First Quarter          

Gross domestic product (GDP) increased at an annual rate of 1.3% in the first quarter of 2024, according to the second estimate from the Bureau of Economic Analysis. In the fourth quarter, GDP rose 3.4%. April’s initial, or advance, estimate showed first-quarter GDP rose 1.6%. A downward revision to consumer spending largely accounted for the decrease. Compared to the fourth quarter, the personal consumption expenditures (PCE) price index increased 3.3%, a downward revision of 0.1 percentage point. Excluding food and energy prices, the PCE price index increased 3.6%, a downward revision of 0.1 percentage point.

Eye on the Week Ahead

The manufacturing and services surveys for May are out this week. April saw growth in both sectors slow. The employment figures for May are also available this week. April saw a significant downturn in the number of new jobs added, leading to guarded optimism that the Fed may be more inclined to lower interest rates.