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Benchmarks closed in the red following a series of disappointing domestic reports. Major indices retreated following four days of consecutive gains. Meanwhile, quite surprisingly, retail sales fell in the month of March. Consumer sentiment declined to its lowest level in nine months in April. The two major banking giants reported quarterly results on Friday but failed to impress the Street. The energy sector was the biggest loser among the S&P 500 industry groups while consumer discretionary stocks were the major gainers.                                 

The Dow Jones Industrial Average (DJI) fell 0.08 points to close the day at 14,865.06. The S&P 500 fell 0.3% to finish Friday’s trading session at 1,588.86. The tech-laden Nasdaq Composite Index slipped 0.2% to end at 3,294.95. The fear-gauge CBOE Volatility Index (VIX) fell 1.5% to settle at 12.06. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.94 billion shares, significantly lower than 2012’s daily average of 6.45 billion shares. Declining stocks outnumbered the advancers. For the 37% that advanced, 59% declined.

The Dow Jones declined as much as 75 points on Friday but trimmed most of the losses in the final hour of the trading session. Despite a slight decline on Friday, benchmarks logged their best weekly performance since the first week of 2013. The blue-chip index gained 2.1%, the S&P 500 increased 2.3% and the Nasdaq moved up 2.8% over the week.  

According to the U.S. Department of Commerce, retail and food services sales slipped 0.4% to $418.3 billion in March from the previous month. This was contrary to the consensus estimate of an increase of 0.1%. Retail trade sales decreased 0.6% from the previous month. But non- store retail sales grew 13.5% year over year. Sales for auto and motor vehicle dealers dropped 0.6% whereas gasoline sales fell 2.2%. These are the worst retail sales figures in nine months.
According to Thomson Reuters and the University of Michigan, the preliminary estimate of consumer sentiment tumbled to 72.3 in April from the previous month’s figure of 78.6. This was well below the consensus estimate of 78.2. Consumer sentiment fell to its lowest level in nine months. According to experts, higher payroll taxes may have hampered investor sentiment. Producer Price Index fell 0.6% in March to its lowest level in ten months. This was above the consensus estimate of a decline of 0.1%.  

Meanwhile, the two major banking giants reported their quarterly results on Friday. JPMorgan Chase & Co. (NYSE:JPM) reported better-than-expected earnings but revenue fell short of the Street’s estimate. The company’s profit increased 33% in the first-quarter boosted by gains in the investment banking business and mortgage lending. Shares of the company declined 0.6% following quarterly results. Wells Fargo & Co’s (NYSE:WFC) profit increased 22% but its mortgage business declined for two consecutive quarters.  The company’s shares fell 0.8% after the results. According to Thomson Reuters data, earnings of S&P 500 companies are estimated to increase by 1.2% in the first quarter.

The energy sector was the biggest loser among the S&P 500 industry groups and the Energy Select Sector SPDR (XLE) lost 1.5%. Stocks such as Exxon Mobil Corporation (NYSE:XOM), Chevron Corporation (NYSE:CVX), TOTAL S.A. (NYSE:TOT), Suncor Energy Inc. (USA) (NYSE:SU) and Marathon Oil Corporation (NYSE:MRO) slipped 0.3%, 0.8%, 0.9%, 3.2% and 3.7%, respectively.

Consumer discretionary stocks had a good run and were the major gainer among the S&P 500 industry groups. The Consumer Discretionary SPDR (XLY) gained 0.5%. Stocks such as Comcast Corporation (NASDAQ:CMCSA), the Home Depot, Inc. (NYSE:HD), Time Warner Cable Inc (NYSE:TWC), McDonald's Corporation (NYSE:MCD) and, Inc. (NASDAQ:AMZN) increased 0.5%, 2.4%, 0.1%, 1.6% and 1.1%, respectively.

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