June 14, 2021

Weekly Market Commentary June 7th to June 11th 2021

Job openings jumped 12% in the month of April with a record number 9.286 million. By comparison, 9.812 million people were unemployed in April, a difference of 526,000. Jobless Claims continued their downward trajectory, albeit at a slower pace, coming in at 376,000. The sunsetting of enhanced benefits may lead those still unemployed to accept new jobs thus improving claims numbers in the coming weeks.

Consumer prices increased 0.6% in May, slightly higher than expectations. The year-over-year number increased to 5%. Ex-Food and Energy rose 0.7% on the month and 3.8% year-over-year. The devil is in the details, which suggest the inflation picture is a little more positive than the headline numbers indicate. The areas where inflation is really popping are dining out and travel, two things people weren’t able to do much of this time last year. The biggest year-on-year increases include car and truck rentals (109.8%), gasoline (56.2%) and used cars and trucks (29.7%).

Investors largely shrugged off inflation numbers with the S&P 500 hitting new highs on Thursday. The index closed the week at 4,247, a 0.4% gain; while the NASDAQ gained 1.8% to finish the week at 14,069. The DJIA fell on the week by -0.8%. In fixed income, the 2-year U.S. Treasury finished flat this week at 0.15%; while the 10-year and 30-year each dropped by about -10 basis points to 1.45% and 2.14% respectively.

Next week we will get Producer Prices, Retail Sales, Housing data and we’ll hear from the FOMC.