Daily Market Color

Equities Search for New Catalyst

Equities end week in the red
US stocks fell from all-time highs to end the month of April with all three major indices closing down on the day; the tech-heavy Nasdaq led the decline (-0.85%). Although equities ended the day in the red, April saw the broadest rally on record during the month, with approximately 95% of members above their 200-day moving average. Investors are searching for another catalyst to push equities higher, as fiscal stimulus, vaccinations, corporate earnings, and opening economies become further priced into equities. The month of April also saw a rally in rates as the 10y closed 12bps lower than its March finish. For the day, yields and swap rates declined along the belly of the curve with the 10y UST yield closing flat at 1.63%.
Personal income and spending soar
Personal income had the highest monthly increase on record, driven by the most recent pandemic fiscal stimulus. Personal incomes increased 21.1% (+20.3% exp) during March, while spending jumping 4.2% — the steepest rise since last summer.
USD/CAD price falls below support level
Trading around 1.2280 today, USD/CAD this week broke through key levels, with the rate now firmly below the 1.2400/1.2500 support range. Moving forward, keep a close eye on 1.2100 levels which have not been seen since 2017. 

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