Equity markets surged higher as COVID concerns waned and quarterly earnings reports surpassed most estimates. The S&P 500 Index returned 4.67% last week, the best weekly return since early November. Earnings season was in full gear as 108 names in the S&P 500 announced quarterly results. The median earnings surprise was 6.95% higher than analyst estimates, a primary driver of equity returns last week.
The steepening yield curve trend continued with shorter-dated US Treasury bond yields down and longer-dated US Treasury bond yields higher. The two-year Treasury note yield matched record lows on Friday, while the 10-year US Treasury bond yield hit year-to-date highs. Monday’s ISM Manufacturing Index survey missed the consensus expectation but signaled manufacturing expansion.