March is typically the month that the NCAA tournament brings bracket-busters and mayhem. Unfortunately, that's what March brought to markets - between rising interest rates, inflation fears, Fed doubters, and a blocked Suez Canal - the headlines have been full. However, just like an onion, when you peel back the layers, what's underneath is more important.
The economic news was disappointing in the first half of the week last week as Housing data and economic activity was lower than expected. Then on Thursday, Weekly Jobless Claims came in much lower than expected - dropping below 600,000 claims for the first time since the pandemic started. This week, we'll get the March Jobs Report, which could build on last week's positive claims number. So far, the market expects the Jobs Report to be mildly positive. Any surprise to the upside could be a bolster to markets this week.
COVID vaccinations continue at a frenetic pace in the U.S. In fact, the U.S. leads the world in the number of vaccination shots administered. The U.S. also ranks near the bottom in terms of mortality from COVID. With more than 2.71 million people getting a vaccination shot daily, and more than 60% of senior having received at least one dose, hospitalizations and deaths have declined dramatically. A recent study of the National Bureau of Economic Research found that 87% of COVID coverage by U.S. media was negative last year. That compares to only 51% negative coverage among international media. You've heard the phrase, "If it bleeds, it leads." That's the mantra of the media - increase viewers, increase advertising revenues.
Treasury yields abated last week giving the selloff in bonds a little breather. Any kind of reprieve in yields, positive data on the jobs front, and continued vaccination progress and equity markets could push higher this week. A rapid rise in treasury yields and a disappointing jobs number and all bets are off. The long run, however, looks good as state economies continue to re-open. April will be a key month as many recreational business gear up for what could be a strong summer for leisure.
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