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    Capital Markets | 5 min read

    Market Commentary: Week of April 4, 2022

    Last Week

    Last week’s biggest market event in this reporter’s opinion was the continued sky-rocketing yield of the U.S. Treasury 2-year note as it rose another 19 basis points for the week with 2s 10s curve spread inverting Friday. Both Fed Funds futures and Overnight Index Swaps (OIS) are predicting three consecutive 50 basis point rate hikes now (May, June, and July meetings). The 2-year note, one year from now, is approximately 3.09%. Personally, I don’t think that bodes well for stocks as the TINA (There Is No Alternative) phenomenon will weaken significantly if you believe in that 2-year forward rate as predicted by the yield curve. Stocks were volatile again last week but ended up Friday more or less where they started on Monday. Oil came off sharply mostly from the demand expectations side as the COVID surge in China and other Asian nations have forced economic shutdowns.

    • S&P 500, despite a fair amount of volatility, ended up nearly unchanged for the week. The average daily move was .90%.
    • The NASDQ increased 0.6% for the week. The average daily move for the week was 1.24%.
    • The 2-year Treasury yield jumped another 19 basis points for the week closing 2.46% on Friday, a new year over year high. For those keeping score at home the note has increased 103 basis points since month-end February. High year over year 2.46%, low yield .10%.
    • The 10-year Treasury yield declined 9 basis points for the week, closing at 2.39% Friday. Year over year high yield 2.48%, low yield .91%.
    • The VIX Index fell 6% for the week, closing at 19.63 Friday. Year over year high 36.45 and low 15.07.
    • The MOVE Index dropped 13.5% for the week, closing at 108.34 on Friday. Year over year high 140.03 and low 42.53.
    • 5-year Investment Grade Corporates (as measured by Markit CDX) spreads tightened 6 basis points for the week closing at 66 basis points Friday. High spread Year over year high 78 and low of 46.56.
    • High Yield corporate debt (as measured by Markit CDX) widened 6 basis points, closing at 374 basis points on Friday. Year over year high 411, and low 269.
    • US Dollar Index was mostly unchanged for the week closing at 98.63 on Friday. Year over year high 99.29 and low 89.44.
    • WTI Crude declined 12.8% for the week using the May WTI Futures contract, closing at 99.27 Friday. Year over year 123.70, and low 47.62.
    • Gold, as measured by the May 2022 futures contract, fell 1.8% for the week closing at 1,921 on Friday. High price for the front contract year over year 2,043 and low 1,678.
    • Bitcoin rose 3.6%, closing at 46,167 Friday. High price year over year 67,734 and low 29,865.

    The Week Ahead

    We come in this morning with short end Treasury yields down a bit after another week of sharp rises. Stocks are relatively flat. The war gets worse now with atrocities in Ukraine committed by Russian military forces. That makes for more sanctions and even more diminished chances of some sort of cease fire or peace talks. What has been done won’t be forgotten for a very long time as another terrible line has been crossed. Risk markets have spent the last two weeks paring back the losses they suffered in the first weeks of the Ukraine-Russia war. I think there are too many analysts and investors out there that are not putting enough emphasis on just how much worse the geopolitical situation can get, or even what it is now. If I thought there were slim chances of going back for Putin last week, with these blatant war crimes, there really is no going back now. The risks of that are incalculable.



    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.

    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.

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    John Tuohy

    John Tuohy is CEO of SWBC Investment Services, LLC, a Broker/Dealer and SWBC Investment Company, an SEC Registered Investment Advisor (RIA). In his role, John is responsible for identifying, developing, and executing the division's strategic plan and all business development, sales, and marketing activities.

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