A balanced jobs report on Friday spurred a rally to bring stocks back to about even for the week. Official unemployment dropped to 3.9%, but soft wage gains may encourage the Fed to pursue a slower path of interest rate hikes. Apple, the world’s most valuable public company, rose 13% for the week, driven by strong earnings results and news that Warren Buffet increased his stake. M&A activity remained strong, with T-Mobile agreeing to buy Sprint and Marathon Petroleum buying Andeavor, which will create the nation’s largest oil refiner if approved.

Weekly Returns

S&P 500: 2,663 (-0.2%)
FTSE All-World ex-US (VEU): (-0.5%)
US 10 Year Treasury Yield: 2.95% (-0.00%)
Gold: $1,315 (-0.7%)
EUR/USD: $1.196 (-1.4%)

Major Events

  • Monday – T-Mobile agreed to buy Sprint for $26 billion in a deal that is expected to be closely scrutinized by antitrust enforcers.
  • Monday – Marathon Petroleum agreed to buy Andeavor for $23 billion.
  • Monday – Wal-Mart sold its British unit Asda Group to rival J Sainsbury for $10 billion.
  • Tuesday – Apple overcame fears of soft iPhone sales with strong earnings results and the announcement of a $100 billion share buyback plan.
  • Tuesday – Guitar maker Gibson filed for bankruptcy.
  • Wednesday – The Wall Street Journal reported that over half of the 20+% earnings growth in Q1 was driven by tax law changes.
  • Wednesday – Rudy Giuliani said President Trump reimbursed his personal lawyer for a $130,000 payment made to Stephanie Clifford.
  • Friday – President Trump said a time and date have been set for a meeting with North Korean leader Kim Jong Un.

    • Our Take

    Tesla is one of the most polarizing stocks I can remember. People seem to either love it or hate it. CEO Elon Musk took this to a new level with unusual behavior on the company’s earnings call this week, including deciding not to answer some questions he deemed “boring.” Shares fell 6% the next day despite most financial metrics being better than expected.

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