The Week Ahead – The Line in the Sand

Welcome to “The Week Ahead” where we take a moment to provide our thoughts on what we can expect in markets and the economy during the upcoming week.

Just last August, the headline risk was potential nuclear war with North Korea. Well, this past week we saw history made as North Korea leader Kim Jong Un became the first North Korean leader ever to cross the DMZ (also known as the most heavily armed border in the world) to visit South Korea… and then pledging with South Korean President Moon Jae-In to formally end the Korean War by the end of 2018. The Korean War first broke out in 1950 and, while there was an armistice signed in 1953, no official peace treaty has ever been signed. To start bringing the two Koreas together, North Korea will shift its time zone 30 minutes forward to align with South Korea starting May 5^th. Random tidbit of 1950’s history, the S&P 500 as we know it today began in 1957. Prior to that it was known as the S&P 90. Back in 1957, the 500 stocks within the S&P 500 represented 90% of the total market value of the entire U.S. stock market.

If you haven’t had a chance to read my colleague Louis Abel’s most recent quarterly piece, please do so here.

Plenty of data points to be reviewed by investors in the week ahead. The market is currently only pricing in a 6% chance of the Fed hiking at next week’s FOMC meeting, especially given that no press conference or economic update is currently scheduled following their rate decision. We’ll close the week with Friday’s employment report. Expect wage growth to continue to trend upward and for the unemployment rate to stay steady at 4.1% or even possible decrease to 4%. 

Data deck for April  28 – May 4: