US Stocks Ended April 7, 2017

Bob Carey
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US Stocks Ended April 7, 2017

Posted Under: Weekly Market Commentary

Equity markets trended down this week as the S&P 500 had a -0.24% return, only the 4th negative week to date in 2017. News headlines were packed with the U.S. Supreme Court confirmation, Chinese President Xi visiting the U.S. and President Trump deciding to bomb a Syrian airbase that launched chemical attacks on Tuesday. Stocks started to sell off around noon on Thursday as President Trump hinted that something had to be done after the Syrians used poisonous gas on their own citizens. Thursday night, President Trump had a dinner with Chinese President Xi around the time when he ordered the U.S. to bomb the Syrian base raising geopolitical risks for the market. Trade implications of the meeting between President Xi and President Trump remains an important topic for equity markets. In 2016 the U.S./China trade deficit was nearly $350b, meaning the U.S. purchased $350b more in goods from China, by far the largest trade deficit of any partner of the U.S., something President Trump is hoping to change. On Friday, President Trump's Supreme Court nominee Neil Gorsuch was confirmed by the Senate after Republicans used the 'nuclear' option to invoke cloture on Senate debate. There are broad market expectations that Justice Gorsuch will be a conservative justice, particularly when it comes to business related matters. Despite the geopolitical headlines, U.S. equity markets remained relatively strong as there were bright spots in markets with improved jobs reports, wage reports and durable good orders. According to Bloomberg, as first quarter earnings season winds down, S&P 500 profits have grown an estimated 9.7%, with the financial and technology sectors driving growth. Looking ahead to next week, geopolitics will be in the forefront as the market digests any Russian reaction to the Syrian bombings. Also, meaningful economic data expected to be announced include: consumer confidence, jobless claims, March Retail sales and the March consumer price index. Further, on Thursday of next week 2Q earnings season gets into swing as mega banks JPMorgan Chase & Co., Wells Fargo & Co. and CitiGroup Inc. are all expected to report.

Posted on Monday, April 10, 2017 @ 7:51 AM • Post Link	Share:
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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