First Western Trust’s investment management team shares their insight into the economy and global markets for the week ending March 1, 2013:
Equity markets were relatively unchanged for the week; however, they were volatile as the S&P 500 fell -1.8% on Monday before recovering those losses by Friday. While there was significant domestic economic data for investors to digest, the real “stories” of the week were the Italian Parliamentary elections and the U.S. sequestration cuts.
Domestically, despite continued positive housing data and improving manufacturing data, the looming sequestration cuts garnered significant headlines. For much of the week, the two politi-cal parties seemed more focused on assigning blame for the upcoming cuts than working to pre-vent them. Though the President and Congressional leaders met on Friday, seeking to prevent the cuts, they were unable to do so. Thus the cuts, $85B for the 2013 fiscal year, went into effect on Friday night.