Market Update - May 9, 2021
Hope all is well. Happy Mother’s Day! It was an uneven week for the major U.S. stock indexes, as the Dow climbed nearly 3%, the S&P 500 added more than 1%, and the NASDAQ fell more than 1%, with most of its weekly decline coming on Tuesday. The Dow and the S&P 500 both set records, eclipsing highs set less than a month earlier. In honor of Mother’s Day I have broken down this week’s news using some motherly wisdom.
It’s all fun and games until someone loses…
A job. We experienced a setback in the labor market. Friday’s jobs report fell far short of expectations as the recent rollback of pandemic-related restrictions failed to provide much lift to the labor market. The economy generated 266,000 new jobs in April, far below economists’ expectations for a gain of nearly 1 million. The unemployment rate actually rose from 6.0% to 6.1%.
You won't be happy until you break that, will you?
Corporate earnings growth continues to break records. S&P 500 companies are now expected to report a cumulative 49% increase over last year’s first-quarter results. That’s up significantly from the roughly 25% gain that analysts had forecast at the start of earnings season.
If you're too sick to go to school, you're too sick to play outside.
Manufacturing continued to be too sick to participate in the economic recovery. The Institute for Supply Management’s (ISM) index of manufacturing activity came in at 60.7 in April—down from 64.7 in March and below expectations for a 65.0 reading. A separate reading on the services sector also fell below expectations.
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