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Overview: Stocks were mixed across the globe last week. The U.S. stock market rallied after a busy week of generally positive earnings, with the S&P 500 up 1.2% for the week. Overseas, international developed stocks were basically unchanged and emerging markets lagged, largely due to a stronger dollar which hurt returns. Through the first quadrimester of 2019, all major stock indices are up at least 12%, and bonds are up about 3% for the year.

Economy: The U.S. economic growth beat expectations, with GDP growing at an annualized quarterly rate of 3.2%, well above the consensus of 2.3%. This number should be viewed with a big caveat however, as net exports and inventories contributed more than half of the 3.2% number. Since trade and inventory are volatile numbers that effect the headline number, a better gauge is final sales, which grew by only 1.4%, well below the 3.5% average of last year. It is important for investors to understand that we still have a growing economy, but slower growth is to be expected.

Looking ahead: This morning, markets got a read on consumer spending and inflation as spending rebounded in March. In addition, the Federal Reserve’s preferred inflation gauge, the personal consumption expenditures (PCE) index, fell to a 1-year low of 1.6%, below the Fed’s 2% goal. This week, we have a scheduled Fed meeting where officials are expected to hold rates steady. The week of data will culminate with the jobs report on Friday. Non-farm payrolls are expected to increase by 180,000, average hourly earnings are projected to be higher by 3.3%, and the unemployment rate consensus is to hold steady at 3.8%.

This communication is for informational purposes only. It is not intended as investment advice or an offer or solicitation for the purchase or sale of any financial instrument.

Indices are unmanaged, represent past performance, do not incur fees or expenses, and cannot be invested into directly. Past performance is no guarantee of future results. 8486426