Economic Market Summary

Market Down and Dirty

Last Week’s Economic/Market Summary


  • U.S. equities moved higher last week, driven by mega-cap tech names.
    • S&P 500 +3.45% Dow +3.22%, Russell 2000 +3.85%, Nasdaq +3.37%1
      • The All-Country World Index gained +3.44%.1
    • S&P 500 sub-sectors were all higher last week.
      • Consumer Discretionary & Energy led to the upside. 1
      • Healthcare & Consumer Staples were the worst performers with gains around 2%.1
    • The CBOE Volatility Index (VIX) declined 14% to end at the lows of this bear market. 1
  • US Treasury bond yields moved higher last week.
    • US 2yr +0.30% at 4.06%, 10yr +0.10% to 3.48%, 30yr +0.03% to 3.67%.1
    • This week broke the streak of Treasuries having their best performance since Covid began.
  • Commodities as an aggregate asset class moved higher last week.
    • WTI Crude gained almost 10%.1
    • Gold declined -0.67%.1
    • The US Dollar index declined -0.36%.1
  • In our opinion, U.S. economic data was mixed last week.
    • Core PCE, the Fed’s preferred inflation gauge, came in at 4.6%, inline with expectations. 1
    • Consumer confidence ticked higher in March. 1
    • Jobless claims stayed stubbornly low. 1
  • An index of equities outside the US (FTSE All-World ex-US) rose +2.70%.1


  • US Equities continued to show strength in the face of forward economic uncertainty.
    • All major indices were higher by over 3% last week, led by small-caps. 1
      • Small-caps were helped as Financial & Energy companies bounced higher following their recent bouts of severe underperformance.
    • The Nasdaq is now up 17.05% year-to-date with the S&P 500 at +7.46%.1
      • We remind readers that bouts of outperformance by the tech sector is common during uncertain economic periods.
      • During the 2000-2002 economic cycle, the Nasdaq had 11 rallies of more than 10% and 4 that were between 28%-49% before truly bottoming down over 70% from the highs. 1
    • Interesting to note that 3 stocks (Apple, Nvidia, & Microsoft) have contributed 91% of the S&P 500’s gain year to date. 1
      • Taking it a step further, just 9 companies have contributed 160% of the S&P 500’s gains so far in 2023. 1
      • Looking at market cap change so far in 2023 we see that 15 companies in the S&P 500 have gained $1.8 trillion in value while the other 485 companies in the index have declined $21 billion. 1
  • US equity sectors were all higher last week.
    • Energy & Consumer Discretionary led the way.
    • Energy will also scream higher to start the week as OPEC announced a surprise oil output cut yesterday which undoubtedly will add a fresh inflationary jolt to the global economy.
      • In our opinion, this cut is not something done if demand is seen to be strong, but just the opposite.
      • Looking past the shock, historically, crude has been negative 1, 3, & 6 months following production cuts by OPEC. 1
  • US Treasury yields reversed their recent trend and went higher last week.
    • A broad measure of Treasury volatility, the ICE BofA MOVE Index, continues to sit near its highest levels since the 2008 financial crisis and in the 94 percentile of its historical range. 1
      • We believe this does not signal economic strength like recent equity performance would suggest.
  • In our opinion, we have some fairly clear recent evidence of a chase happening in the equity markets.
    • As such, we have to look at the credit markets which continue to flash warning signs.
    • As discussed, bond market volatility is trading near historic levels at the same time credit spreads have widened substantially.
      • Historical comparisons to similar economic fundamentals do not paint pretty forward pictures for equity markets.
  • We believe, just like in October 2007 and February 2020, the markets are responding to dynamics of inelasticity (See: Hope; FOMO) more than economic fundamentals. o We continue to watch the credit markets and small caps as the bid for safety kicks the mega-caps higher. We believe credit & small-caps are telling the real story.

Ryan A. Mumy, CFP®,

AIF® – Chief Investment Officer

Contact: 828/855-9400 or 

 1 Source: Bloomberg – 3/31/2023 

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