Stock Market Rebound Continues in April

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The stock rebound continued into April during which the U.S. stock market came within striking distance of new highs during the month.

Raymond James Chief Economist Scott Brown notes that while economic gauges are mixed, most of the data is consistent with moderate growth. The majority of the economy, i.e., consumer spending and housing are strong. However, business fixed investment is soft and election-year uncertainty may also come into play.

The Federal Reserve’s latest policy statement stuck to the expected script, espousing a “wait and see” approach. What that means is that policymakers are expecting to gradually normalize monetary policy as long as economic growth remains sustainable. For now, Brown believes, it looks like the central bankers also expect moderately strong growth this year.

Raymond James Chief Investment Strategist Jeff Saut believes the outlook for the equity markets remains sunny, with stronger commodities helping to stabilize emerging economies and central banks forming a united front in Europe and Asia. In addition, the auto and housing markets look solid, and earnings have been coming in better than expected thus far, with a few exceptions among tech heavyweights. Even the meager GDP (i.e., economy) growth rate appears sustainable, Saut believes. “We think GDP is going to ramp in the back half of this year,” he wrote in his April commentary. “Yes, there will be pullbacks, but… they are for buying…”

Our team will continue to monitor the latest economic and financial data on your behalf. Please do call us with any questions.