A 1.6% pull back in the S&P 500 and a 1.9% drop in the Nasdaq during the last trading day of April closed out a difficult month for the markets. The S&P 500 declined 4.16% and the Nasdaq declined 4.41% last month. The CNN Fear & Greed Index dipped into fear territory by mid-April and stayed there the rest of the month.
The drop in markets was driven by expectations that the Fed is not likely to reduce interest rates anytime soon because inflation appears to have stabilized above the Fed’s 2% target level and wage pressure increased in Q1. The Employment Cost Index (ECI) increased 1.2% in the first quarter and labor costs increased 4.2% year-over-year.