Weekly Market Recap
Week ended June 2
Market-moving news
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Momentum shift
Lifted by a strong monthly U.S. jobs report and the resolution of the debt ceiling battle, stocks rallied on Thursday and Friday as the major indexes posted weekly gains of around 2%. The results pushed the S&P 500 above a narrow range that it has traded in since the start of April.
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Defying expectations
U.S. labor market strength again exceeded economists’ expectations, as the 339,000 jobs added last month came in well above the consensus forecast. The latest monthly figure was just below the 12-month average monthly gain of 341,000 jobs, and the totals for March and April were revised upward by a total of 93,000 jobs.
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Debt ceiling breakthrough
Financial market fears of a potential U.S. credit default were lifted as the House of Representatives and the Senate approved an agreement to lift the government’s debt ceiling for another two years. The measure was sent to the White House to be signed into law in advance of a June 5 deadline by which the government faced the risk of being unable to pay its bills.
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May's moves
Although U.S. stocks generally traded in a narrow range throughout May, performance varied widely among the major indexes. The NASDAQ rose 5.8%, the S&P 500 gained 0.3%, and the Dow fell 3.5%. At the S&P 500 sector level, information technology posted the strongest result while energy had the weakest.
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Fading volatility
An index that measures investors’ expectations of short-term U.S. stock market volatility fell around 19% for the week, dropping to the lowest level in more than three years. The Cboe Volatility Index sank on Friday to 14.6, just above its level before the start of the COVID-19 pandemic in February 2020.
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NASDAQ's streak
The NASDAQ’s latest weekly gain was its sixth in a row, the longest streak for the index since a string that ended in January 2020. At Friday’s close, the NASDAQ was at its highest level since April 2022.
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Year-to-date variations
The first five months of 2023 produced widely varying returns at the sector level. Within the S&P 500, the information technology sector was up more than 33% year to date through May while communication services added 32%. Overall, 8 out of 11 sectors posted negative results, with energy down nearly 13% and financials down almost 8%.
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Eurozone inflation
Inflation in the countries that use the euro currency eased more than expected in May, with the annual inflation rate dropping to 6.1% from 7.0% the previous month. May’s figure was the lowest for the eurozone since February 2022.
The week ahead: June 5-9
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Important disclosures
Unless otherwise noted, all data is from FactSet.
The data provided is for informational purposes only and is not an endorsement of any security, mutual fund, sector, or index. This does not illustrate the performance of any John Hancock fund. The information contained here is not guaranteed as to accuracy or completeness. All economic and performance information is historical and does not guarantee future results.
The Dow Jones Industrial Average is a price-weighted index comprising 30 widely traded blue chip U.S. common stocks. The NASDAQ Composite Index is a market-value-weighted index of all common stocks listed on the NASDAQ stock exchange. The S&P 500 Index tracks the performance of 500 of the largest publicly traded companies in the United States. The MSCI Europe, Australasia, and Far East (EAFE) Index tracks the performance of publicly traded large- and mid-cap stocks of companies in those regions. The Cboe Volatility Index (VIX) shows the market’s expectation of 30-day volatility and is constructed using the implied volatilities of a wide range of S&P 500 Index options. Weekly and year-to-date figures for the VIX show percentage changes, not investment returns. The Russell 2000 Index tracks the performance of approximately 2,000 publicly traded small-cap companies in the United States. The Bloomberg U.S. Aggregate Bond Index (Agg) tracks the performance of U.S. investment-grade bonds in government, asset-backed, and corporate debt markets. It is not possible to invest directly in an index.
The Treasury yield curve is derived from available U.S. Treasury securities trading in the market and is provided directly by the U.S. Federal Reserve. The spread measures the difference in yield between two government securities. A normal (positive) yield curve occurs when longer-term rates are higher than shorter-term rates. The opposite holds true for an inverted yield curve. Year-to-date changes in U.S. Treasury bond yields are shown in basis points (BPS). One hundred basis points equals one percent.
Oil prices are represented by West Texas Intermediate (WTI) crude oil.
The G20 countries comprise a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85% of global gross domestic product, and over 75% of global trade.
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Investment returns
Equities
U.S. equity size and style total returns as of 6/2/23 (%)
1 week
| 1.9 | 2.0 | 2.1 | Large | |
| 2.2 | 2.3 | 2.4 | Medium | |
| 3.6 | 3.3 | 3.1 | Small | |
| Value | Core | Growth | ||
YTD
| 1.2 | 12.1 | 23.8 | Large | |
| 0.1 | 3.9 | 10.8 | Medium | |
| -0.2 | 4.6 | 9.3 | Small | |
| Value | Core | Growth | ||
Index/market total returns as of 6/2/23 (%)
| Close | 1 week | YTD | |
|---|---|---|---|
| Dow Jones Industrial Average | 33,762.8 | 2.2 | 2.9 |
| NASDAQ Composite Index | 13,240.8 | 2.1 | 27.0 |
| S&P 500 Index | 4,282.4 | 1.9 | 12.4 |
| MSCI EAFE Index | 2,097.7 | 0.9 | 10.2 |
| Cboe Volatility Index | 14.6 | -18.9 | -32.7 |
International/developed (%)
| 1 week | YTD | |
|---|---|---|
| EAFE | 0.9 | 10.2 |
| Europe | 0.3 | 12.1 |
| France | 0.1 | 15.0 |
| Germany | 0.6 | 16.2 |
| Italy | 1.4 | 17.7 |
| Japan | 2.6 | 11.6 |
| Spain | 1.4 | 16.5 |
| Switzerland | 0.0 | 12.2 |
| U.K. | 0.9 | 7.5 |
Emerging markets (%)
| 1 week | YTD | |
|---|---|---|
| EM | 1.3 | 3.9 |
| Brazil | 2.2 | 8.3 |
| China | 1.5 | -5.0 |
| India | 0.8 | 1.3 |
| Indonesia | -1.4 | 10.1 |
| Korea | 3.3 | 17.2 |
| Mexico | -0.5 | 23.5 |
| Russia | #N/A | #N/A |
| Taiwan | 1.0 | 19.2 |
S&P 500 sectors (%)
| 1 week | YTD | |
|---|---|---|
| S&P 500 Index | 1.9 | 12.4 |
| Communication services | 1.1 | 34.5 |
| Consumer discretionary | 3.4 | 22.9 |
| Consumer staples | 0.4 | -0.5 |
| Energy | 1.4 | -7.7 |
| Financials | 2.2 | -3.6 |
| Healthcare | 2.2 | -3.7 |
| Industrials | 2.7 | 3.3 |
| Information tech | 1.4 | 36.4 |
| Materials | 3.1 | 1.6 |
| Real estate | 3.1 | 0.3 |
| Utilities | 0.8 | -7.0 |
Fixed income, currencies, and commodities
U.S. fixed-income style total returns as of 6/2/23 (%)
1 week
| 0.1 | 0.5 | 1.8 | High | Credit quality |
| 0.3 | 0.8 | 1.7 | Medium | |
| 0.6 | 1.2 | 1.5 | Low | |
| Limited | Moderate | Extensive | ||
| Interest-rate sensitivity | ||||
YTD
| 1.5 | 1.7 | 3.1 | High | Credit quality |
| 1.4 | 1.9 | 3.4 | Medium | |
| 4.5 | 4.6 | 3.4 | Low | |
| Limited | Moderate | Extensive | ||
| Interest-rate sensitivity | ||||
U.S. Treasury bond yields as of 6/2/23 (%)
| END OF WEEK | PRIOR YEAR END | YTD CHANGE (BPS) | |
|---|---|---|---|
| 2 Yr | 4.51 | 4.42 | 4 |
| 10 Yr | 3.69 | 3.88 | -19 |
| 30 Yr | 3.88 | 3.97 | -9 |
| 2-10 spread | -82 | -54 | -28 |
| 10-30 spread | 19 | 9 | 10 |
U.S. bond sector total returns (%)
| 1 week | YTD | |
|---|---|---|
| Aggregate | 1.0 | 2.2 |
| Bank loans | 0.3 | 3.6 |
| Convertible | 0.5 | 4.3 |
| Corporate | 1.2 | 3.3 |
| High yield | 1.2 | 4.6 |
| MBS | 1.3 | 1.9 |
| Municipal | 0.9 | 2.0 |
| Preferreds | 3.4 | 12.3 |
| TIPS | 0.3 | 1.9 |
| Treasury | 0.7 | 2.0 |
Global bond total returns (%)
| 1 week | YTD | |
|---|---|---|
| EM Local | 0.5 | 5.8 |
| EMD USD | 1.3 | 2.3 |
| Global Agg | 1.1 | 1.6 |
| Global Agg Ex-U.S. | 1.3 | 1.3 |
| Multiverse | 1.1 | 1.7 |
Commodities (%)
| 1 week | YTD | |
|---|---|---|
| BBG Com Ind | -0.2 | -9.7 |
| Oil (WTI) | -1.2 | -8.9 |
| Gold | 0.4 | 7.1 |
Currencies (USD) (%)
| 1 week | YTD | |
|---|---|---|
| EM FX | -0.2 | 3.1 |
| AUD | 1.6 | -2.5 |
| CAD | 1.5 | 0.8 |
| CHF | 0.0 | 2.0 |
| EUR | 0.2 | 0.5 |
| GBP | 1.2 | 3.8 |
| JPY | 0.6 | -5.5 |
GDP
Jobs
Inflation
Ex-U.S.
Regions/countries
| GDP Growth (%) annualized | Inflation Rate (%) CPI | Unemployment Rate (%) | 10-Year Government Bond (%) | Sovereign Credit Rating | |
| Eurozone | 1.3 | 6.1 | 6.5 | _ | _ |
| China | 4.5 | 0.1 | 5.2 | 2.72 | A+ |
| Germany | -0.5 | 6.1 | 5.6 | 2.31 | AAA |
| Japan | 1.3 | 3.5 | 2.6 | 0.42 | A+ |
| U.K. | 0.2 | 8.7 | 3.9 | 4.16 | AA |
Fund industry overview
Total net flows: open-end funds and ETFs as of 4/30/23 ($B)
| MONTH | 12 Month | ASSETS | |
| U.S. Equity | -7.3 | -41.5 | 11,338.4 |
| Sector Equity | -3.1 | -86.6 | 1,170.7 |
| Allocation | -6.8 | -86.4 | 1,292.5 |
| International Equity | -4.9 | -67.1 | 3,652.3 |
| Alternative | -0.2 | 4.4 | 163.1 |
| Commodities | -0.3 | -30.8 | 167.4 |
| Taxable Bond | 20.4 | -31.6 | 4,921.0 |
| Municipal Bond | -0.4 | -65.8 | 853.5 |
| Total all long-term funds | -1.3 | -388.1 | 23,728.5 |
Leading Morningstar fund categories by monthly net flows as of 4/30/23 ($B)
| MONTH | 12 Month | ASSETS | |
| Intermediate Core Bond | 11.8 | 55.6 | 1,187.0 |
| Large Blend | 11.1 | 84.2 | 5,635.2 |
| High Yield Bond | 6.7 | -16.7 | 299.1 |
| Intermediate Core-Plus Bond | 5.7 | -14.4 | 715.6 |
| Foreign Large Blend | 2.9 | 24.4 | 1,375.1 |
Lagging Morningstar fund categories by monthly net flows as of 4/30/23 ($B)
| MONTH | 12 Month | ASSETS | |
| Large Growth | -7.2 | -64.5 | 2,051.4 |
| Large Value | -6.2 | -18.4 | 1,588.7 |
| Foreign Large Growth | -4.2 | -45.6 | 483.2 |
| Ultrashort Bond | -4.0 | 2.4 | 316.5 |
| Moderate Allocation | -3.7 | -40.5 | 675.7 |
Important disclosures
Unless otherwise noted, all data is from FactSet.
The data provided is for informational purposes only and is not an endorsement of any security, mutual fund, sector, or index. This does not illustrate the performance of any John Hancock fund. The information contained here is not guaranteed as to accuracy or completeness. All economic and performance information is historical and does not guarantee future results.
The Dow Jones Industrial Average is a price-weighted index comprising 30 widely traded blue chip U.S. common stocks. The NASDAQ Composite Index is a market-value-weighted index of all common stocks listed on the NASDAQ stock exchange. The S&P 500 Index tracks the performance of 500 of the largest publicly traded companies in the United States. The MSCI Europe, Australasia, and Far East (EAFE) Index tracks the performance of publicly traded large- and mid-cap stocks of companies in those regions. The Cboe Volatility Index (VIX) shows the market’s expectation of 30-day volatility and is constructed using the implied volatilities of a wide range of S&P 500 Index options. Weekly and year-to-date figures for the VIX show percentage changes, not investment returns. It is not possible to invest directly in an index.
The Treasury yield curve is derived from available U.S. Treasury securities trading in the market and is provided directly by the U.S. Federal Reserve. The spread measures the difference in yield between two government securities. A normal (positive) yield curve occurs when longer-term rates are higher than shorter-term rates. The opposite holds true for an inverted yield curve. Year-to-date changes in U.S. Treasury bond yields are shown in basis points (BPS). One hundred basis points equals one percent.
Oil prices are represented by West Texas Intermediate (WTI) crude oil.
The G20 countries comprise a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85% of global gross domestic product, and over 75% of global trade.
