Interest rates are on the move higher
Interest rates are on the move higher. The yield on the 10-year Treasury hit near multi-year highs of 2.59% on Friday. (LPL Research)
We have had a little time to digest past the headlines on last Fridays job report. The U.S. economy added 235,000 jobs in February 2017, exceeding expectations. The details of the report were solid, with a 0.1% drop in the unemployment rate to 4.7%, and an acceleration in average hourly earnings to +2.8% year-over-year from +2.6% in January 2017. The data all but cements the case for a 25 basis point rate hike by the Fed this week, and another two hikes after that in 2017 are nearly priced in by the market. (LPL Research)
Small caps down for sixth consecutive days last week for the first time since an eight-day losing streak in September 2015. Even though the S&P 500 is only 1.3% away from new highs, we have noticed a jump in new 52-week lows on the NYSE. In fact, four consecutive days have seen more 52-week lows than 52-week highs from NYSE issues, yet the S&P 500 is less than 2% away from an all-time high. July 2015 and December 2014 were the last two times that happened and both of those led to near-term corrections. (LPL Research)
The S&P 500 is flat and the NASDAQ is down 5. The MSCI international index is lower.
Oil is down 10 cents at $48.40 a barrel.
Gold is up $3 at $1204 a Troy ounce.
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.