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Market Direction Is Important –
Updated Chart of the S&P 500 and Secondary Signals
Of our Four secondary indicators under our MTI:
Relative Strength Index (RSI)-Negative
Chaikin Money Flow (CMF)-Positive
Money Flow Index-MFI-Negative
More on the Market and the Economy:
Stocks finished higher on Friday, rebounding after the jobs report showed that companies scaled back hiring in April. The S&P 500 closed the week down .4%, logging its second consecutive weekly loss.
This week data will be released on small business optimism, retail sales, business inventories and the Job Openings and Labor Turnover Survey.
The economy created 160,000 jobs in April, the smallest gain in seven months, while the unemployment rate was unchanged at 5%. More people dropped out of the work force, and the labor force participation rate fell for the first time in seven months, slipping to 62.8%.
The trade deficit shrank almost 14% to $40.4 billion in March – the lowest level in over a year – as exports slipped .9% while imports dropped 3.6%.
Source: Census Bureau
The Atlanta Fed’s GDPNow model is forecasting growth of 1.7% for the second quarter.
Speaking last Tuesday, San Francisco Fed President John Williams said that his outlook for the economy is “pretty optimistic”, and that he expects the Fed “to be raising rates gradually over the next couple of years due to the strength of the labor market and where I see inflation going…So overall I haven’t changed my view of what growth over the whole year will be, around 2% GDP growth, which is what we saw last year”.
Manufacturing was sluggish in April, with the ISM index slipping to 50.8%, as a measure of new orders declined. A gauge of employment rose, though still negative at 49.2%.
The service sector picked up in April, as the ISM non-manufacturing index rose to 55.7. Measures of employment and new orders increased.
Construction spending rose in March, edging up .3% on a jump in residential spending, which was up 1.5%.