• Domestic equities advance slightly
• 10-year Treasury yield closes near high for the year
• Earnings impress
• Equity market volatility expected to continue

Domestic equity markets advanced about .50% for the week in volatile trading. The majority of S&P 500 sectors turned in positive results with Energy stocks advancing close to 3%. Energy sector stocks have outperformed all other sectors handily over the last month. Consumer Staple stocks turned in the worst performance declining over 4% for the week. The decline can be partially attributed to the poor quality of Philip Morris earnings and the decline of tobacco stocks in general.

The yield on the benchmark 10-year Treasury bond closed the week at 2.95% advancing 12 basis points and near the high for the year. More importantly, renewed concern over the flattening of the yield curve has reappeared as the spread between the 2-year Treasury and 10-year Treasury bond shrank to it lowest point in 12 years during the week.

Earnings from investments continue to impress. With just under 20% of S&P 500 companies reporting, 80% of companies have exceeded earnings estimates. Earnings growth for Q1 is currently running over 18% on a year over year basis. Revenue results are also stronger than expected aided in part by a weaker dollar.

We expect volatility in the domestic equity markets to continue for now given the relentless negative news flow out of Washington and continued questions about the anticipated pick up in economic growth and inflation.

The economic calendar includes the release of March existing home sales on Monday; Tuesday the Consumer Confidence Index for April in reported. Durable Goods data is reported Thursday. Friday the initial estimate of GDP for the first quarter is unveiled.

Earnings season continues in abundance; some of the highly visible companies reporting include:

Monday – Alphabet, Haliburton, Hasbro, UBS Group, Kimberly Clark, and TD Ameritrade

Tuesday – Verizon, Caterpillar, Pulte Group, Coca-Cola, and SAP

Wednesday – Facebook, Twitter, AT&T, Visa, Ford, Boeing, Viacom, Comcast, and GlaxoSmithKline

Thursday – Amazon, AbbVie, UPS, Dunkin Brands, Pepsi, Intel, Starbucks and D.R. Horton

Friday – Exxon Mobil, Chevron, and Moody’s

Indices for the week and YTD are as follows:

S & P 500 up .52% for the week; YTD index return is -.13%

NASDAQ Composite up .56% for the week; YTD index return is +3.52%

Dow Jones Industrial Average up .42% for the week; YTD index return is -1.04%

Benchmark 10-year Treasury bond yield stands at 2.95% - up 12 basis points on the week