Stocks dipped on Friday as investors weighed the latest batch of Q1 earnings reports against strong U.S. economic data. Despite the session's weakness, the S&P 500 notched its third straight month of gains in April, adding more than 5% this week as investors bet on a big economic recovery. The Dow also rose about 2.7% and the Nasdaq outperform at 5.4%.
For U.S. economic data, U.S. personal income increased by the most on record in March on the back of historic levels of fiscal stimulus. Personal income rose at a better-than-expected 21.1% in March over February, the Bureau of Economic Analysis reported Friday. Personal spending also increased at a more-than-expected rate last month at 4.3%, while the personal savings rate soared to 27.6%.
Meanwhile, the University of Michigan's Consumer Sentiment Index reading for April came above expectations at 88.3, above the preliminary reading of 86.5 and March's final of 84.9.
"The April survey recorded continued gains in consumer confidence due to a growing sense that the upward momentum in jobs and incomes will persist," Richard Curtain, chief economist for Survey of Consumer, said in a statement. "The renewed confidence is due to record federal stimulus spending, both recently passed and proposed, as well as the positive impact from a growing share of the population who are vaccinated."
"The largest and most important change in April was that an all-time record number of consumers expected declines in the unemployment rate during the year ahead. Even if a booming economy resulted in higher inflation, consumer optimism would not diminish since consumers have already anticipated a temporary increase," Curtain continued. "Overall, the data indicate an exceptional outlook for consumer spending through mid-2022. The size and persistence of the spending gains depend on continued job growth as well as wages that effectively draw people back into the labor force."
Here's how the market settled to close out the week:
S&P 500 Index
Dow Jones Industrial Average
Nasdaq Composite Index
For Stocks, Amazon
For Sector Performance, sectors on the S&P 500 were mostly lower, with Energy
For Commodities and Currency, the U.S. Dollar
For the week ahead, market participants will react to the April jobs report, as well as another wave of quarterly earnings reports from companies like General Motors