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    The markets continued their roller coaster ride last week with both equities and rates experiencing noteworthy swings over the course of the week. Inflation concerns led rates to test their highest level in over a month with 10-Year Treasuries nearing 4.40% before reversing course and closing back around the 4.25% area as worries about the health of the economy took the lead. The S&P 500 forcefully experienced a broad sell-off and gave back the gains it achieved over the past 2 weeks, led by Big Tech getting hammered on concerns about tariff implications, inflation, and consumer spending. Investor anxiety remains elevated as we await more news regarding the April 2 tariff deadline.

    Last week’s releases included a number of data points that continue to keep investor uncertainty and angst at elevated levels. Consumer Confidence again declined to 92.9, keeping the index below the important 100 level suggesting pessimism is well entrenched. University of Michigan Sentiment was revised lower reiterating consumer angst with a reading of 57.0 for the month of March. Given the importance of the consumer to the domestic economy sustained pessimism is not a recipe for a constructive economic environment. Finally, core-PCE came in higher at 0.4% MoM lifting the YoY figure to 2.8%. Clearly, it does not demonstrate the desired progress toward the Fed’s 2% goal. These figures, coupled with the uncertainty of the ongoing tariff situation have failed to instill confidence in the markets. I expect equities will continue to react negatively to the slowing economy and rates will eventually succumb to the growing inflationary pressures and reach higher yields at some point in the coming months. Investors may have the opportunity to buy the dip in equities as the 5400 and 5200 areas mark meaningful support. I await the catalyst to push Treasuries up above 4.40 to the next support around 4.55%.

    From the Trading Desk (with contributions from Ryan Riffe)

    The municipal market experienced another tumultuous week as April can't come soon enough. The AAA MMD scale was cut (yields were increased) from 4-12 basis points across the curve with the largest impact beyond 20-year maturities. The supply/demand imbalance was a consistent issue throughout the month. Liquidity in the secondary market continues to be a challenge given the steady increase in both dealer inventory and syndicate new issue balances. The 10-year ratio (77% of US Treasuries) has now reached its most attractive level since 2023. Although ratios and absolute yield levels are compelling, demand has yet to meaningfully rise. This dynamic was evident as municipal bond funds experienced another week of outflows. Along with March, April marks one of the weakest months of the year for reinvestment capital. For municipal bonds to gain traction, there will need to be more clarity for not only the economy but future tax policy regarding the exempt status of municipal bonds.

    Municipal New Issue supply $9.4 billion ($8.66 billion Tax-exempt, $0.75 billion Taxable)

    Ratios

    US TSY  2yr 3.910%   70%

    US TSY  3yr 3.894%   72%

    US TSY  5yr 3.979%   74%

    US TSY 10yr 4.253%  78%

    US TSY 30yr 4.631% 92%

     

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    An index is unmanaged and not available for direct investment. Definitions sourced from Bloomberg.

    The Bloomberg Barclays Global Aggregate Negative Yielding Debt Market Value Index represents the portion of the Bloomberg Barclays Global Aggregate Index that measures the aggregate value of global debt with a negative yield. • The S&P 500® is widely regarded as the best single gauge of large-cap U.S. equities and serves as the foundation for a wide range of investment products. The index includes 500 leading companies and captures approximately 80% coverage of available market capitalization. • The NASDAQ Composite Index is a broad-based capitalization-weighted index of stocks in all three NASDAQ tiers: Global Select, Global Market and Capital Market. The index was developed with a base level of 100 as of February 5, 1971.• The Cboe Volatility Index® (VIX) is a calculation designed to produce a measure of constant, 30-day expected volatility of the US stock market, derived from real-time, mid-quote prices of weekly S&P 500® Index (SPX) call and put options with a range of 23 to 37 days to expiration.• The ICE BofA MOVE Index is a yield curve weighted index of the normalized implied volatility on 1-month Treasury options. It is the weighted average of implied volatilities on the CT2 (Current 2 Year Government Note), CT5 (Current 5 Year Government Note), CT10 (Current 10 Year Government Note), and CT30 (Current 30 Year Government Note), with weights 0.2/0.2/0.4/0.2 respectively.• The Markit CDX North America Investment Grade Index is composed of 125 equally weighted credit default swaps on investment grade entities, distributed among 6 sub-indices: High Volatility, Consumer, Energy, Financial, Industrial, and Technology, Media & Tele-communications. Markit CDX indices roll every 6 months in March & September. • The Markit CDX North America High Yield Index is composed of 100 non-investment grade entities, distributed among 2 sub-indices: B, BB. All entities are domiciled in North America. Markit CDX indices roll every 6 months in March & September. • The U.S. Dollar Index (USDX) indicates the general international value of the USD. The USDX does this by averaging the exchange rates between the USD and major world currencies. Intercontinental Exchange (ICE) US computes this by using the rates supplied by some 500 banks.

    Investing involves certain risks, including possible loss of principal. You should understand and carefully consider a strategy’s objectives, risks, fees, expenses, and other information before investing. The views expressed in this commentary are subject to change and are not intended to be a recommendation or investment advice. Such views do not take into account the individual financial circumstances or objectives of any investor that receives them. All indices are unmanaged and are not available for direct investment. Indices do not incur costs including the payment of transaction costs, fees, and other expenses. This information should not be considered a solicitation or an offer to provide any service in any jurisdiction where it would be unlawful to do so under the laws of that jurisdiction. Past performance is no guarantee of future results.

    © 2025 SWBC. All rights reserved. Securities offered through SWBC Investment Services, LLC, a registered broker/dealer. Member FINRA & SIPC. Advisory services offered through SWBC Investment Company, a Registered Investment Advisor, registered as such with the US Securities & Exchange Commission. SWBC Investment Services, LLC is under separate ownership from any other named entity. SWBC Investment Services, LLC a division of SWBC, is a nationwide partnership of advisor.

    Christopher Brigati, Chief Investment Officer — Managing Director

    Prior to joining SWBC, Brigati was Senior Vice President, Managing Director of Municipal Investments at Valley National Bank. With over 25 years of experience primarily in the municipal market, he is a recognized thought leader in the fixed-income markets and is a regular contributor with appearances on Bloomberg Television and Radio. He has authored numerous economic commentaries and his insights have been featured in leading financial media publications, including The Bond Buyer, The Wall Street Journal, and Bloomberg. Brigati has also been an active participant with the Bond Dealers of America (BDA) trade association, advocating regulators and legislators on Capitol Hill on behalf of the broker-dealer community. Before joining Valley National Bank, he served as Managing Director and Head of Municipal Trading at Advisors Asset Management, Inc. (AAM). Before that, he had a long career at Morgan Stanley where he served as Managing Director and Head of Wealth Management Municipal Trading for eight years. Brigati holds a bachelor’s degree from The State University of New York at Albany School of Business. He is registered for Series 3, 4, 7, 24, 53, and 63.

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