Weekly Market Snapshot from Frazier Allen for the week of April 8th, 2013

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

The economic data were generally disappointing. Nonfarm payrolls rose by a disappointing 88,000 in March (median forecast: +200,000), up 759,000 before seasonal adjustment (vs. +901,000 in March 2012). Payroll figures for January and February were revised a net 61,000 higher (adjusted payrolls average a 168,000 monthly gain in 1Q13, roughly the same pace as the last two years).

Mild weather in February may have pulled forward some of March’s strength, but the slowdown could signal a lagged impact of the payroll tax increase. The unemployment rate fell to 7.6% (vs. 7.7% in February and 8.2% a year ago), but this was once again due to a decrease in labor force participation (participation should be rising if the labor market is strengthening, as individuals are lured back into the job market). The employment/population ratio edged down to 58.5%, trending roughly flat over the last few years.

The week’s other data were mostly on the soft side of expectations. The ISM surveys both declined in March, still above the breakeven level, but suggesting somewhat slower growth. Unit motor vehicle sales held about steady on a seasonally adjusted basis. Weekly claims for unemployment insurance benefits jumped for the second consecutive week (after trending lower in the first two and a half months of the year).

Policy makers at the Bank of England and the European Central Bank stood pat. However, the Bank of Japan took a much more aggressive stance, targeting a doubling of the monetary pace and a 2% inflation rate in two years.

The stock market was volatile. Bond yields fell sharply.

Next week, the FOMC policy meeting minutes should renew focus on the Fed’s debate (about whether to reduce its asset purchases). The retail sales report should be relatively soft, held down partly by lower gasoline prices.

Indices

	Last	Last Week	YTD return %
DJIA	14606.11	14526.16	11.46%
NASDAQ	3224.98	3256.52	6.80%
S&P 500	1559.98	1562.85	9.38%
MSCI EAFE	1659.21	1668.52	3.44%
Russell 2000	925.66	950.24	8.98%

Consumer Money Rates

	Last	1-year ago
Prime Rate	3.25	3.25
Fed Funds	0.16	0.17
30-year mortgage	3.57	3.98

Currencies

	Last	1-year ago
Dollars per British Pound	1.520	1.588
Dollars per Euro	1.288	1.314
Japanese Yen per Dollar	96.170	82.640
Canadian Dollars per Dollar	1.013/td>	0.996
Mexican Peso per Dollar	12.334	12.821

Commodities

	Last	1-year ago
Crude Oil	93.26	101.47
Gold	1548.39	1618.69

Bond Rates

	Last	1-month ago
2-year treasury	0.22	0.26
10-year treasury	1.69	2.06
10-year municipal (TEY)	3.22	3.09

Treasury Yield Curve – 04/05/2013

S&P Sector Performance (YTD) – 04/05/2013

Economic Calendar

April 8th	—	Bernanke Speaks (“Bank Stress Tests”) Trade Balance (February)
April 9th	—	Small Business Optimism Index (March) Trade Balance (February)
April 10th	—	FOMC Minutes (March 20)
April 11th	—	Jobless Claims (week ending April 6)
April 12th	—	Producer Price Index (March) Retail Sales (March)
April 16th	—	Consumer Price Index (March) Housing Starts, Building Permits (March) Industrial Production (March)
April 26th	—	Real GDP (1Q13, advance)
May 1st	—	FOMC Policy Decision (no press briefing)
May 3rd	—	Employment Report (April)
May 19th	—	FOMC Policy Decision, Bernanke Press Briefing

Important Disclosures

[320left]Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business April 4th, 2013.

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