The stock market reflects a variety of emotions over time, but no one can say that it suffers from excess pessimism at the moment.
In the face of what might be labeled as conflicting trends, Mr. Market chooses to err on the side of optimism, and by more than a little. The S&P 500 (SPX) was up 4.4% in April, and has climbed more than 15% over the past year, including last month. We've all heard that the stock market's a forward-looking animal but, based on the latest economic numbers, is this confidence really warranted?
No one really can say for sure, but we can at least revisit what's already set in stone. By that measure, one could argue that the jury's still out on the economic outlook, as per the numbers released for April. Our table below is a reminder that red ink still plagues the statistical tally, albeit only marginally. Last month, weekly hours of production workers slipped by 0.3% while retail sales contracted by 0.2%. For this past year through April, the big loser was housing starts, which plunged by more than 16%.