April’s technology-led sell-off plunged the S&P 500 and Nasdaq to their 2022 lows. The violent slide was due to multiple factors - the Federal Reserve’s monetary tightening, rising interest rates, persistent inflation, Covid case spikes in China and the ongoing war in Ukraine. In April, the Nasdaq was down 13.3%, the S&P 500 lost 8.8% and the Dow Jones dropped 4.9%. Now, investors begin to consider if, instead of a simple stock market correction, if a more troubling, wider decline is in the cards.
Economic reports from last week came back mostly negative: •National Economic Activity - better than expectation •Manufacturing (Dallas) - worse than expectation •Manufacturing (Richmond) - better than expectation •Manufacturing (Kansas City) - worse than expectation •Single-Family House Prices - better than expectation •New Home Sales - worse than expectation •Pending Home Sales - worse than expectation •Consumer Confidence - worse than expectation •Consumer Earning/Spending - better than expectation •Jobless Claims - worse than expectation This week, investors will look for guidance from economic reports like Construction Spending, Vehicle Sales, Job Openings, Private & Total Employment, Productivity, Consumer Credit and Jobless Claims.