Stocks moved higher this week as investor sentiment improved following the sharp sell-off at the end of last week. Federal Reserve Chairman Jerome Powell testified before Congress on Tuesday, reinforcing the notion that despite early signs of stabilization in the economy, the road to recovery will be long. The Fed also announced plans to broaden their credit facility by purchasing individual corporate bonds, a welcomed sign for fixed income investors. Optimism surrounding further stimulus was heightened following reports that the Trump administration was in the process of drafting a roughly $1 trillion infrastructure plan. On the data front, retail sales staged an impressive recovery of 17.7% in May, surpassing even the most optimistic estimates. Housing stats told a different story with data for the month of May coming in much softer than expected, although the previous month’s figures were revised upward. Investors will be looking forward to Thursday’s jobless claims reports for some more color surrounding the current labor market in the wake of the U.S. economy reopening. Interest rates moved higher this week, with the yield on the 2-year and 10-year Treasury notes trading around 0.20% and 0.75% respectively mid-week.
Source: Bloomberg, WSJ Market Data, GSAM