“There is only one side of the market and it is not the bull side or the bear side, but the right side.” – Jesse Livermore

1. US consumer confidence hits lowest level since July 2022 — The Conference Board’s consumer confidence index retreated to 97 in April, below economists’ expectations for 104 and lower than March’s reading of 103.1. The Conference Board reasoned this was driven by a more pessimistic outlook for “future business conditions, labor market conditions, and income expectations.” Several months of inflation data have come in hotter-than-expected, as price pressure prove more persistent than some policymakers and economists had expected. New data showed the core Personal Consumption Expenditures (PCE) index, which strips out the cost of food and energy and is closely watched by the Federal Reserve, rose 2.8% over the prior year in March, above estimates for 2.7% and unchanged from the annual increase seen in February.
2. Fed Says Inflation Progress Has Stalled and Extends Wait-and-See Rate Stance — In their policy statement released Wednesday, officials highlighted a “lack of further progress” toward bringing inflation down in recent months. But Fed Chair Jerome Powell said at a news conference that he didn’t think it was likely the Fed would need to consider interest-rate increases, and he volunteered that rate cuts could begin if the labor market weakened unexpectedly. Separately, the central bank approved plans to slow the ongoing reduction of its $7.4 trillion asset portfolio in a bid to extend the wind-down of emergency pandemic stimulus efforts it launched four years ago. The Fed can reinvest the proceeds of its Treasury securities into new ones when they mature, but since 2022 it has been allowing up to $60 billion in Treasurys to roll off the portfolio every month. Starting in June, it will slow this monthly pace of decline to $25 billion.
3. US Jobs Post Smallest Gain in Six Months as Unemployment Rises — US employers scaled back hiring in April and the unemployment rate unexpectedly rose, suggesting some cooling is underway in the labor market after a strong start to the year. Nonfarm payrolls advanced 175,000 last month, the smallest gain in six months, a Bureau of Labor Statistics report showed Friday. A later release showed that business activity in the service sector — the largest part of the economy — unexpectedly weakened to the lowest level in four years, while prices climbed. Average hourly earnings climbed 0.2% from March and 3.9% from a year ago, the slowest pace since June 2021. Some economists were expecting a stronger increase in part due to a new California law mandating a $20 minimum wage for fast-food workers, which took effect April 1.
4. Dairy Workers Urged to Use Protection to Prevent Bird Flu — Dairy workers remain at risk for the H5N1 bird flu that’s spreading in cows and should wear protection to ward off the virus, US health officials said as they released details on one worker who experienced an eye infection.
The dairy worker underwent genetic testing of samples from both eyes and his nose, according to a letter to the New England Journal of Medicine from the US Centers for Disease Control and Prevention’s Tim Uyeki and Texas health officials, which confirmed the presence of the virus. The highly contagious strain of avian flu has spread across dairy cattle in 36 herds across nine states this year, and the US Food and Drug Administration said it found fragments in one out of every five commercial milk samples tested. The US Department of Agriculture is testing beef for the presence of H5N1 because of concerns about potential spread to humans. Pasteurized milk and cooked beef are safe to consume, the FDA has said.

The week ahead — Economic data from Econoday.com:

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