John Hancock: Weekly Market Recap Week Ended April 15th

Earnings time

A handful of major U.S. banks kicked off earnings season with mixed results. Overall, the biggest banks are expected to suffer from difficult year-over-year comparisons to the big profits they reported earlier in the recovery from the pandemic. As of Friday, analysts were forecasting that first-quarter earnings for banks in the S&P 500 fell 37% from a year ago, according to FactSet.

8.5% inflation

The gap has widened again between actual inflation and the 2.0% figure that the U.S. Federal Reserve maintains as its target rate for helping to foster sustainable economic growth. The government on Tuesday reported that the Consumer Price Index jumped to 8.5% in March, up from 7.9% the previous month. March’s figure is the highest since 1981.

Gold’s allure

With inflation running high, investor interest in gold has recently perked up, sending the price to another weekly gain. Gold futures were trading around $1,976 on Thursday, up $30 from a week earlier. However, gold has yet to surpass the recent high of $2,040 that it reached in early March.  

Modest retail gain

Despite high inflation, U.S. retail sales rose by 0.5% in March, although sales slipped 0.3% when excluding gasoline purchases. The latest overall increase marked the third consecutive monthly gain in retail sales, although February’s 0.8% figure was higher than March’s number.half-point, but instead approved a smaller quarter-point increase.