Weekly: Indexes Ended Lower, Big Tech Earnings & Q1 GDP on Tap

1. Major Indexes Returns

The major U.S. stock indexes traded in a narrow range for the third week in a row and the $S&P 500(.SPX)$, the $NASDAQ(.IXIC)$, and the $DJIA(.DJI)$ each finished with a fractional decline.

Since the start of April, the gap between the S&P 500’s highest daily closing level and its lowest close has been a mere 1.6%. The $Cboe Volatility Index(VIX)$ that measures investors’ expectations of short-term U.S. stock market volatility fell for the 5 week in a row.

As of last Friday, the$Straits Times Index(STI.SI)$ gained 0.58% last week and$S&P/ASX 200(XJO.AU)$ lost 0.42% weekly.

2. Sectors and Stocks of $S&P 500(.SPX)$

Last week, Basic Materials, Energy, and Communication Services three sectors dropped over 2%, and Consumer Defensive, Real Estate sectors gain over 1.5%.

The top 10 winners of$S&P 500(.SPX)$ are $Intuitive Surgical(ISRG)$ , $Snap-on(SNA)$ , $First Republic Bank(FRC)$ , $D.R. Horton(DHI)$ , $Las Vegas Sands(LVS)$ , $Digital Realty Trust Inc(DLR)$ , $Abbott Laboratories(ABT)$ , $Enphase Energy(ENPH)$ , $DexCom(DXCM)$ , $United Continental(UAL)$

3. Other Assets

Bitcoin pullback:After eclipsing $30,000 the previous week, the price of Bitcoin dropped to nearly $27,000 on Friday. The YTD 2023 of Bitcoin is 76.4%.

Dollar weakens: $USD Index(USDindex.FOREX)$ as the world's largest economy is likely headed toward recession, further supporting the view that the Fed could pause in June after another expected rate hike in May.

Gold tends consolidation: Stronger dollar sends gold $Gold - main 2306(GCmain)$ lower ahead of US Q1 GDP and major US tech earnings. With a lack of clear bearish drivers for gold, prices may favor a period of consolidation before the next major catalyst – potentially US GDP

Oil reversal: The price of U.S. crude oil $WTI Crude Oil - main 2306(CLmain)$ fell more than 5% for the week to less than $78 per barrel. The decline marked a reversal from recent weeks’ gains and left oil prices around their levels of a month earlier, when an announcement of production cuts by Saudi Arabia and other countries sent prices higher. And the YTD in 2023 is -1.4%.

4. Macro Factors

Earnings scorecard:After the second week of earnings season, the proportion of $S&P 500(.SPX)$ companies that had beaten analysts’ quarterly net income expectations stood at 76% as of Friday, according to FactSet. That so-called beat rate ranks slightly below the 77% five-year average. Across sectors, consumer discretionary and industrials stocks are expected to report the strongest earnings growth overall.

Home price decline: For the first time in 11 years, prices of existing U.S. homes have fallen for two months in a row. The National Association of Realtors said that the median existing home sale price in March fell 0.9% from a year earlier to $375,000.  

Debt ceiling showdown: The latest round of partisan brinkmanship in Washington, D.C., over the nation’s debt ceiling fueled anxiety for investors. House Republicans on Wednesday introduced a bill that would cut federal spending in exchange for lifting the ceiling for one year. Meanwhile, the government continued to take special accounting measures to meet debt obligations and prevent a potential default.   

Q1 GDP a modest slowdown?US Q1 GDP is scheduled to release its initial estimate, with most economists expecting that GDP expanded at an annual rate of around 2.0%. That would mark a modest slowdown from the fourth quarter of last year, when GDP growth was 2.6%.

What’s coming up this week: big tech earnings, first-quarter GDP figures, PCE prices, and housing market updates.

5. The week ahead: April 24-28

This week, some of the largest companies in the world will report earnings, including big tech companies $Apple(AAPL)$ , $Amazon.com(AMZN)$ , Google parent $Alphabet(GOOG)$ , $Microsoft(MSFT)$ and $Meta Platforms, Inc.(META)$.

Key events the coming week:

Monday

• No major reports scheduled 

Tuesday

• S&P/Case-Shiller 20-City Composite Home Price Index

• Consumer Confidence Index, The Conference Board

• New home sales, U.S. Census Bureau

Wednesday

• Durable goods orders, U.S. Census Bureau

Thursday

• First-quarter GDP, advance estimate, U.S. Bureau of Economic Analysis

• Weekly unemployment claims, U.S. Department of Labor

• Pending home sales, National Association of Realtors

Friday

• Personal Consumption Expenditures Price Index, U.S. Bureau of Economic Analysis

• University of Michigan Index of Consumer Sentiment

• Personal income and spending, U.S. Bureau of Economic Analysis 

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