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MARKET MONITOR 
|
June 4

MARKET MONITOR | June 4

Chart of the Week


LABOR

In the US, the mismatch between labor supply and demand is top of mind for policymakers. While the ease of finding a job has returned to pre-pandemic levels, labor market supply remains suppressed due to early retirement, generous unemployment benefits, and lingering health concerns. Individuals that would otherwise take jobs on offer appear to be delaying the search.

Source: FactSet, Goldman Sachs GIR, and Goldman Sachs Asset Management

Market Summary


GLOBAL EQUITIES

US equities rallied at the tail end of this past week following a weaker-than-expected payrolls release that eased concerns of a shift to tighter monetary policy. Growth-style equities would have been particularly vulnerable to the possibility of rising rates, leading the S&P 500 to rise 0.64% this past week. In the UK, optimistic energy demand estimates overtook inflation worries and drove the FTSE 100 0.73% higher. The Eurostoxx 600 also moved higher this past week, up 0.26%. Read More

COMMODITIES

Continued OPEC+ commitment to supply restraints and an effective COVID-19 vaccination rollout within the US and European economies drove oil prices higher. Prices were additionally bolstered by lower-than-expected US crude inventory and Iranian oil supply, driving WTI and Brent crude oil to $69.62 and $71.89 per barrel, respectively. Read More

FIXED INCOME

US Treasuries saw volatile trading on the back of mixed jobs data, with 10-Year yields hitting their highest levels since mid-May before ending the week lower at 1.56%. This past week, the Fed announced that it would wind down the portfolio of its Secondary Market Corporate Credit Facility, signaling confidence in the US IG credit market. In Europe, the 10-Year UK Gilt and German bund yields ended the week at 0.79% and -0.21%, respectively. Read More

FX

The US dollar whipsawed this past week, ending 0.04% higher against a basket of peers as jobs reports showed a mixed picture of the US recovery. In China, the yuan reached a three-year high against the US dollar, raising concerns about the competitiveness of Chinese exports. The PBoC announced that in response, financial institutions would need to increase the ratio of their forex reserves. Read More

Economic Summary


PRODUCTION

US ISM Manufacturing posted roughly in-line with expectations, rising to 61.2 in May from 60.7 the month prior. At a composition level, the print was softer than the headline index, as both the production and employment components declined. In China, the Composite PMI posted 53.8 in May, mostly driven by services. Read More

INFLATION

Euro area inflation is expected to edge higher in May, with the HICP flash estimate indicating an above-consensus rise of 2.0% YoY, up from 1.6% in April. Energy prices are set to have the highest annual rate in May at 13.1%, followed by services prices at 1.1%. Read More

JOBS

In the US, nonfarm payrolls rose by 559k in May, coming in significantly below expectations but higher than the surprisingly weak 266k print in April. The unemployment rate declined 0.3 pts to 5.8% in May, in-line with expectations. While some investors saw the print as disappointing, others were optimistic that the Fed may remain dovish as a result. US initial jobless claims continued their downward trend, falling to a lower-than-expected print of 385k for the week ending May 29. In the Euro area, unemployment continued its decline, posting 8.0% in April, down from 8.1% in March. Read More

Style Performance


US Equity Size & Style Returns

MONTH-TO-DATE

Large
0.77% *
0.55% *
0.34% *
Medium
0.81% *
0.47% *
-0.24% *
Small
1.82% *
0.78% *
-0.38% *
Value
Core
Growth

YEAR-TO-DATE

Large
19.31%
12.77%
6.68%
Medium
21.84%
15.10%
3.17%
Small
29.79%
16.20%
3.70%
Value
Core
Growth

MSCI World Size & Style Returns

MONTH-TO-DATE

Large
1.09%
0.76%
0.41%
Medium
1.19%
0.72%
0.20%
Small
1.30%
0.80%
0.28%
Value
Core
Growth

YEAR-TO-DATE

Large
17.28%
12.09%
7.00%
Medium
19.27%
12.88%
5.70%
Small
21.42%
15.55%
9.60%
Value
Core
Growth

US Fixed Income Maturity and Quality Returns

MONTH-TO-DATE

Government
-0.01%
0.03%
0.55%
Corporate
-0.02%
0.06%
0.50%
High Yield
0.21%
0.26%
0.56%
Short
Intermed.
Long

YEAR-TO-DATE

Government
-0.23%
-1.04%
-10.61%
Corporate
0.21%
-0.83%
-5.45%
High Yield
3.87%
2.61%
1.74%
Short
Intermed.
Long

European Fixed Income Maturity and Quality Returns

MONTH-TO-DATE

Government
0.03%
0.20%
0.34%
Corporate
0.04%
0.25%
0.53%
High Yield
0.30%
??????
??????
Short
Intermed.
Long

YEAR-TO-DATE

Government
-0.34%
-1.15%
-7.39%
Corporate
0.17%
-0.21%
-3.87%
High Yield
2.80%
??????
??????
Short
Intermed.
Long

Source: Bloomberg, Barclays and GSAM (as of 06/04/21)

VIEW LESS DISCLOSURE

Key Economic Releases


Monday, Jun 07

Tuesday, Jun 08

China CPI YoY (Cons: 1.6%, Prior: 0.9%)
China PPI YoY (Cons: 8.5%, Prior: 6.8%)

Wednesday, Jun 09

Thursday, Jun 10

US Jobless Claims (Cons: 370k, Prior: 385k)
US Core CPI YoY (Cons: 4.7%, Prior: 4.2%)
US CPI YoY (Cons: 3.4%, Prior: 3.0%)

Friday, Jun 11

UMich Cons. Sentiment (Cons: 84.2, Prior: 82.9)

VIEW LESS DISCLOSURE

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