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May 03, 2022

April 2022

Provided by YCharts

Equities returned to their losing ways in April
 after a slight March reprieve, with the S&P 500 falling 8.7% and the growth-heavy NASDAQ diving 13.2%. While only one sector ended March in the red, only the defensive-oriented Consumer Staples was able to finish higher in April, up 2.3%. The cyclical sectors, Technology, Consumer Discretionary, and Communication Services, were all down double digits. Year to date, the Dow is down 8.7%, the S&P 500 is 12.9% lower, and the NASDAQ is in bear market territory at -21%.

Oil slipped below $100 for the first time in weeks, now $99.60 per barrel of WTI and $99.27 per barrel of Brent Crude. Speaking of firsts, the economy contracted for the first quarter since Q2 2020, with US Real GDP declining 1.4% (by definition, two consecutive quarters of GDP decline = a recession). Finally, new single-family home sales fell 8.6% last month, while the average selling price of an existing home hit an all-time high.

The 20-Year Treasury Rate topped 3% for the first time since March 2019, outpacing the 30-Year bond by 28 basis points. As yields ticked higher, investors fled from stocks in fear of persistently high inflation and a break-neck schedule of Fed rate hikes. The yield curve grew closer to normalization in April, with only the 30-20 and 10-5 Year Treasury spreads remaining inverted at month’s end.

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