Investment Management l Week in Review – April 5, 2013
In this edition of Week in Review, First Western Trust’s investment management team discusses recent economic news out of the U.S. and Europe:
Equity markets ended the week lower, impacted by disappointing U.S. and European eco-nomic news. The Bank of Japan (BOJ) unveiled a series of easing measures as it seeks to re-inflate the Japanese economy.
U.S. economic news was highlighted by March’s unemployment figures, which showed that far fewer jobs were created than expected. While the unemployment rate declined –0.1% to 7.6% for the best reading since December 2008, it was driven almost entirely by individuals leaving the workforce, resulting in a labor force participation rate of 63.3%, the lowest level since May 1979. March PMI data missed analyst expectations though the readings indicated that both the Manufacturing and Services sectors continued to expand. While U.S. data was disappointing, it is too early to tell if this indeed marks the beginning of a seasonal slow-down that some have been forecasting based on the trends of the past three years.
European Manufacturing and Services PMI data both showed further contraction in March with readings of 46.8 and 46.4, respectively. Euro Zone unemployment registered at 12.0%, the highest since the formation of the Euro Zone in 1995. Below expectation, retail sales offered further evidence of the difficulties faced by the region.