Weekly Market Update — May 6, 2023


  • The U.S. equity markets closed the week on a very positive note, but except for NASDAQ, the gains were not positive enough to overcome the losses from earlier in the week
  • When the week closed, 3 of the 4 major U.S. equity indices retreated, as the mega-cap DJIA (-1.2%) lost the most, followed by the S&P 500 (-0.8%), and the smaller-cap Russell 2000 (-0.5%)
  • The tech-laden NASDAQ rallied 2.25% on Friday alone to squeak out a weekly gain of +0.1%
  • Wall Street grappled with a barrage of data this week, including the 10th consecutive rate hike from the Fed, a ton of earnings reports, surprising Employment data and a growing chorus about the looming June 1st debt ceiling deadline
  • Sprinkled into all of that data was a growing concern from a few of the regional banks, as we learned that First Republic Bank was seized by regulators and PacWest and Western Alliance are both considering their options
  • When the week was over, PacWest and Western Alliance dropped by 43.3% and 26.8%, respectively
  • On Wednesday the Fed voted unanimously to raise the target range for the fed funds rate by 25 basis points to 5.00-5.25%
  • And then by week’s end it was as if Apple’s terrific earnings report overshadowed everything and drove markets higher
  • Only three of the 11 S&P 500 sectors closed green this week, led by the odd combination of one growth and two defensive sectors as Information Technology (+0.6%), Health Care (+0.1%) and Utilities (+0.1%) outperformed
  • Of the eight sectors that lost ground, Energy (-5.8%) was hammered, followed by Financials (-2.7%)
  • The 2-year Treasury yield fell 15 basis points to 3.91% and the 10-year Treasury yield remain at 3.42%
  • The U.S. Dollar Index fell 0.4% to 101.24
  • Oil dropped over 7% on the week and came to rest at $71.36/barrel
Weekly Market Performance

Close Week YTD
DJIA 33,674 -012% +1.6%
S&P 500 4,136 -0.8% +7.7%
NASDAQ 12,235 +0.1% +16.9%
Russell 2000 1,759 -0.5% -0.1%
MSCI EAFE 2,145 +0.1% +10.3%
*Bond Index 2,127.65 +0.80% +3.81%
10–Year Treasury Yield 3.42% +0.00% -0.5%

*Source: Bonds represented by the Bloomberg Barclays US Aggregate Bond TR USD. This chart is for illustrative purposes only and does not represent the performance of any specific security. Past performance cannot guarantee future results.

Stock Markets Mostly Fall This Week to Kick Off May

U.S. stock markets fell this week, despite a significant end of the week rally driven largely by Apple’s rosy earnings. And not surprisingly, the tech names did outperform the small, large- and mega-cap indices.

The Fed was back in the news again and on Wednesday, as it implemented its 10th consecutive rate hike which could be the last hike of this cycle. The Fed raised rates by 25 basis points – its 10th since March 2022 – bringing the fed funds rate to 5.0% – 5.25%. Wall Street is hopeful that we might start to see rate cuts later this year.


There was a lot of employment data to digest, including that:

  • The March JOLTS report showed that there were 9.59 million job openings
  • The ADP Employment Change showed an increase of 296,000 in April
  • Weekly Initial Claims were 242k, up from 230k
  • Nonfarm payrolls grew by 253,000 in April
  • Nonfarm private payrolls grew by 230,000 in April
  • The unemployment fell to 3.4% in April from 3.5% in March
  • Average hourly earnings increased by 0.5%


Reviewing the remainder of the week’s economic data:

  • April IHS Markit Manufacturing PMI came in lower at 50.2, down from 50.4
  • March Construction Spending was up 0.3%
  • April ISM Manufacturing Index improved to 47.1%, from 46.3%
  • March Factory Orders were up 0.9%
  • The IHS Markit Services PMI reading for April fell to 53.6 from 53.7
  • The ISM Non-Manufacturing Index for April increased to 51.9% from 51.2% in March (the dividing line between expansion and contraction is 50.0%)

A Very Busy Earnings Week

On Friday, research firm FactSet reported the following via press release:

  • Earnings Scorecard: For Q1 2023 (with 85% of S&P 500 companies reporting actual results), 79% of S&P 500 companies has reported a positive EPS surprise and 75% of S&P 500 companies have reported a positive revenue surprise.
  • Earnings Decline: For Q1 2023, the blended earnings decline for the S&P 500 is -2.2%. If -2.2% is the actual decline for the quarter, it will mark the second straight quarter that the index has reported a decline in earnings.
  • Earnings Revisions: On March 31, the estimated earnings decline for Q1 2023 was -6.7%. Ten sectors are reporting higher earnings today (compared to Mar. 31) due to positive EPS surprises.
  • Earnings Guidance: For Q2 2023, 44 S&P 500 companies have issued negative EPS guidance and 35 S&P 500 companies have issued positive EPS guidance.
  • Valuation: The forward 12-month P/E ratio for the S&P 500 is 17.7. This P/E ratio is below the 5-year average (18.6) but above the 10-year average (17.3).

Number of Job Openings Drops for 3rd Month to Lowest Level in 2 Years

The number of job openings decreased to 9.6 million on the last business day of March, the U.S. Bureau of Labor Statistics. Over the month, the number of hires and total separations were little changed at 6.1 million and 5.9 million, respectively. Within separations, quits (3.9 million) changed little, while layoffs and discharges (1.8 million) increased. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.

Job Openings

On the last business day of March, the number of job openings decreased to 9.6 million (-384,000) and was 1.6 million lower than in December. The job openings rate was 5.8% in March and was down by 1.0 percentage point since December. In March, job openings decreased in transportation, warehousing, and utilities (-144,000) but increased in educational services (+28,000).



In March, the number of hires was little changed at 6.1 million, and the rate held at 4.0%. Hires decreased in real estate and rental and leasing (-29,000).


The number of total separations changed little at 5.9 million in March, and the rate was 3.8% for the fourth month in a row. Over the month, the number of total separations decreased in accommodation and food services (-107,000) but increased in construction (+104,000).


  • In March, the number and rate of quits changed little at 3.9 million and 2.5%, respectively. The number of quits decreased in accommodation and food services (-178,000).
  • In March, the number and rate of layoffs and discharges increased to 1.8 million (+248,000) and 1.2%, respectively. Layoffs and discharges increased in construction (+112,000), accommodation and food services (+63,000), and health care and social assistance (+42,000).
  • The number of other separations was little changed in March at 276,000. Other separations decreased in finance and insurance (-31,000) and in real estate and rental and leasing (-7,000).

Construction Spending Up

According to the U.S. Census Bureau, construction spending during March 2023 was at an annual rate of $1,834.7 billion, 0.3% above February. Further, the March figure is 3.8% above the March 2022 figure. And during the first three months of this year, construction spending amounted to $403.3 billion, 4.3% above the $386.7 billion for the same period in 2022.





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