This year the equity markets have been good with S&P 500 Index (SPX) up 10.94% and Nasdaq 100 up 6.75% through the end of April.
Gold is in a bear market and may drop further. Gold sometimes moves with commodities. With inflation low, central bankers may be selling gold to improve their balance sheets. The dollar index is neutral.
We like Japan, biology, consumer products, wireless, bonds, and utility stocks at this time. This is a time to be more conservative. Our analysis suggests a positive market direction, but we are not overly aggressive, for many long funds. We don’t see a sharp move higher or lower here, just a muddling through increase over time.
We also believe, based on our analysis, that all style-box indexes haveweak momentum with large-cap ahead of small-cap.This large-cap leading is opposite of last month.
Utilities and semiconductor sectors have positive momentum. Oil, finance, and gold momentum are negative. The world indexes have slightly positive price momentum with U.S. highest, followed by emerging markets and the U.K.