The Treasury market is a focal point this morning as a new week of trading gets started. On Friday, the yield on the 10 year Treasury note closed at 2.95% which was the highest closing yield since 2014. Rates flirting with the 3% level have made stock investors wary. In early trading this morning, the 10 year yield is up once again which is keeping U.S. stocks mostly flat and at times they have turned negative.
Earnings season is kicking into full gear this week with Google parent Alphabet Inc., TD Ameritrade Holding Corp. and Whirlpool Corp. all slated to report after the closing bell today. Experts are predicting upbeat news during this earnings season and for most of 2018.
Several economic reports are already out this morning and the news is mostly positive. American companies grew faster in April, especially manufacturers, which is a good indication that the U.S. economy is healthy. The flash IHS Markit U.S. manufacturing PMI climbed to 56.5 in April from 55.5 and hit a three and a half year high. Readings over 50 indicate expansion. On the real estate front, the report on existing home sales for March rose 1.1% but fell off the pace from a year ago.
In geopolitical news, North Korean leader Kim Jong Un said Saturday that his country would shut down its nuclear test site and suspend testing of long range missiles. News is encouraging on the trade front with Mexico hinting that there is progress in NAFTA negotiations and Treasury Secretary Mnuchin has suggested he might go to China to discuss trade matters.
European stocks were struggling after a fresh batch of data but have now recovered and are mostly positive while most Asian indices are in the red. Both Gold and Oil are on the decline.
Now that tax season is behind us, it is a good time to review your financial plan. Give us a call to schedule an appointment.
Have a good week!