John Hancock: Weekly Market Recap Week Ended May 14th
Although the week’s overall declines weren’t huge, the market’s path was choppy, with big declines on the first three days of the week that sent the NASDAQ down a total of 5.2%. Before stocks turned positive on Thursday and Friday, the Cboe Volatility Index briefly climbed to its highest level in more than two months.
With earnings season now almost over, the earnings growth rate could end up as the fastest for any quarter in 11 years, according to FactSet. As of May 10, first-quarter earnings of companies in the S&P 500 were up more than 49% from the same period a year earlier―more than double the 24% rate that analysts had projected at the end of March.
Large-cap U.S. value stocks again extended their run of year-to-date outperformance versus their large-cap growth counterparts, beating them for the fourth week in a row. A value stock benchmark slipped about 0.7% while a growth benchmark fell about 2.0%.
In the wake of April’s spike in consumer prices, comments from U.S. Federal Reserve policymakers reiterated their belief that they don’t see any short-term need to depart from currently accommodative monetary policies. On Thursday, for example, one member of the Fed’s governing board said that he’ll need to see several more months of data on jobs and inflation before determining when to begin tightening policies.