U.S. Treasury Yield Curve

The financial turmoil caused by the coronavirus (COVID-19) pandemic extended into the bond market, as investors drove yields down and raised cash in the most vulnerable areas of the credit markets—particularly the oil and gas sectors, which were hit hardest by the precipitous fall in crude prices. The Federal Reserve has dropped short-term rates to zero and is pumping up to $4 trillion into the system, providing liquidity and credit support.

U.S. & World Equity Indexes; 3/27/20; YTD Return
S&P 500; 2,542; -21.21%
Dow Jones Industrials; 21,968; -23.70%
Nasdaq Composite; 7,544; -15.91%
Shanghai Composite (China); 2,805; -9.11%
S&P BSE Sensex (India); 29,815; -27.84%
Nikkei Stock Avg (Japan); 19,389; -18.04%
CAC 40 (France); 4,324; -27.26%
DAX (Germany); 10,001; -27.34%
FTSE 100 (U.K.); 5,815; -27.20%
Selected Interest Rates; 3/27/20; 2/28/20
15-Year Mortgage; 2.92%; 2.95%
30-Year Mortgage; 3.50%; 3.45%
5-Year Treasury Bond; 0.51%; 1.11%
10-Year Treasury Bond; 0.83%; 1.30%
30-Year Treasury Bond; 1.42%; 1.79%
Key Economic Statistics; Most Recent; Prior Month
National
Producer Price Index; -0.50%; 0.50%
Consumer Price Index; 0.10%; 0.10%
Unemployment Rate; 3.50%; 3.50%
ISM Manufacturing Index; 50.10; 50.90
ISM Services Index; 57.30; 55.00
Change in Non-farm Payroll Emp.; 273,000; 225,000
New York State
Consumer Price Index - NY, NJ, CT; 0.20%; 0.80%
Unemployment Rate; 3.70%; 3.80%
Empire State Manufacturing Survey; -21.90%; 12.90%

Initial Unemployment Claims

The unemployment claims data released for the week of March 21 is the first to reflect the massive shutdowns in the U.S. economy, with over 3.2 million new applications for insurance benefits in a single week. The economic and business data will be dire over the next two months, and perhaps beyond. GDP could decline between 20–25% in the second quarter of 2020.

Equity Market Statistics; Most Recent; Prior Month
Dow Jones Industrials; 3/27/20; 2/28/20
Dividend Yield; 2.82%; 2.34%
Price/Earnings (12 Mth Trailing); 19.47; 20.23
Price/Earnings (Projected); 16.24; 18.82
S&P 500 Index; 3/27/20; 2/28/20
Dividend Yield; 2.08%; 1.88%
Price/Earnings (12 Mth Trailing); 22.40; 22.40
Price/Earnings (Projected); 17.10; 18.53

The information herein was obtained from various sources believed to be accurate; however, Forté Capital does not guarantee its accuracy or completeness. This report was prepared for general information purposes only. Neither the information nor any opinion expressed constitutes an offer to buy or sell any securities, options, or futures contracts. Forté Capital’s Proprietary Market Risk Barometer is a summary of 30 indicators and is copyrighted by Forté Capital LLC. For further information, visit www.fortecapital.com, send a message to [email protected], or call 866-586-8100 and ask for David W. Henion, CPA, or Larry H. Rabinowitz, CPA/PFS.