Markets
While “Sell in May and go away” is a cute rhyme, it has little basis—12 of the past 13 May months have ended higher. And maybe this year, we’ll get May flowers?
Stocks advanced last week as investors moved past stalled progress in Middle East peace talks and refocused on corporate earnings.
The Standard & Poor’s 500 Index rose 0.91 percent, while the Nasdaq Composite Index climbed 1.12 percent. The Dow Jones Industrial Average moved up 0.55 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, added 0.58 percent.¹²
April: Best Month in Five Years for S&P, Nasdaq
Markets were under pressure early in the week as investors focused on stalled peace talks and rising oil prices.³
But by midweek, momentum shifted. First, the Fed announced it was holding interest rates steady, as expected, though there was some dissent over the decision. Then investors’ attention turned to Wednesday’s closing bell, when several big-name companies reported Q1 results.⁴
Investors mostly liked what they heard, and stock prices rose, ending April on a high note. The Dow led the broad market rally, while the S&P 500 and Nasdaq each logged their best monthly performances in five years.⁵
Stocks rose again on Friday as oil prices fell. Investors applauded Q1 results from another high-profile megacap tech company, helping the S&P notch another all-time intraday high.
Fed News
The Federal Reserve voted 8-4 to keep interest rates steady at the April meeting, leaving the Federal Funds Rate at a 3.5 to 3.75 percent target range. Market observers were quick to point out that the 8-4 decision was the Federal Open Market Committee’s most divided vote since 1992.6
At the last FOMC press conference of his eight-year tenure, Fed Chair Powell announced he would stay on as a Fed governor after his term as Chair expires on May 15. Earlier that day, the Senate Banking Committee confirmed Kevin Warsh as the next Fed Chair, setting up a final confirmation vote in the Senate.7
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