International equity markets also gained in value during the week

Weekly Highlights

• The Organization of the Petroleum Exporting Countries (OPEC) reported that its member countries' crude oil output declined by 201,000 barrels a day in March over the previous month, bringing its total average production to nearly 32 million barrels a day. While OPEC members reduced total production, the world's total oil supply rose by 180,000 barrels a day last month as a result of increased production from nonmember countries such as US shale producers.

• In a whirlwind of economic news, at the end of the week President Trump instructed advisors to look into rejoining the much-maligned Trans-Pacific Partnership after he pulled out of the deal negotiated by the previous administration last year. The president's reversal of opinion regarding the trade pact came after he faced pressure from the agriculture industry over the increasingly likely tariffs on agriculture exports from the US to China. The Trans-Pacific Partnership would offer new markets for agriculture exports, which could blunt the effect of China's proposed tariffs.

• As the prospect of a trade war between the world's two largest economies seemed imminent, trade data came out that showed the US deficit with China widened significantly during the first quarter. The deficit was up nearly 20% from the same period a year ago. This served as a stark backdrop in the escalating trade tensions between the two countries, as each has exchanged proposed tariffs on imported goods from the other side. While negotiations are ongoing, it appears likely that some form of tariffs will be implemented by both China and the US in the coming weeks.

Talking Points

• In domestic equity markets, volatility decreased significantly from the week prior, and markets enjoyed healthy returns. Within domestic equities, growth stocks edged out value stocks across all market caps, but this effect was especially pronounced in small cap stocks. In regards to the capitalization spectrum, small cap stocks outperformed large cap stocks.

• International equity markets also gained in value during the week, although to a lesser degree than US markets. In developed markets, value outperformed growth stocks, opposite of US markets. Emerging markets were also up during the week, albeit less than US equity markets and in line with non-US developed markets. •

• Treasury yields were up across the yield curve except at the very short end, where they decreased slightly. The increases in yield were relatively uniform, albeit marginally, across maturities by the end of the day Thursday.

• Commodity prices increased in value through the week. Leading the way was crude oil, which enjoyed particularly strong gains as OPEC said its crude output declined significantly in March. The dollar index was slightly weaker, and gold increased in value during the week.

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