Happy Easter & Happy Passover
Before we say a single word about markets — Happy Easter and Happy Passover to you and your family. Easter is this Sunday; Passover began at sundown on Wednesday and continues through next week. However you are celebrating, we hope this weekend brings real time with the people who matter most — good food, good company, and a genuine break from the noise. We are grateful for every one of our clients and wish you a truly warm and joyful holiday. The numbers will still be here after dessert.
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Market Holiday Note: U.S. equity and bond markets were closed Friday, April 3 in observance of Good Friday. Performance data covers the four trading sessions of March 31 – April 2 (Thursday close). The Bureau of Labor Statistics released the March employment report on schedule Friday morning. Markets respond at Monday's open.
Overview
What Actually Happened This Week
"You can observe a lot just by watching."
— Yogi Berra — who would have watched this week with great satisfaction, since the market did nearly the opposite of what the headlines suggested it should
Against a backdrop of $98 oil, a Fed on hold, and a Q1 that took the S&P down 4.3% and large-cap growth nearly 10%, few would have called a broad first-week-of-Q2 rally. S&P 500 +1.65%. MSCI ACWI +2.95%. International developed markets +3.04%. High-yield bonds +1.21% — credit spreads tightening, not widening. Gold +7.18%. Every fixed income category positive. Holiday-week volume was thin, which amplifies moves, but the breadth was real.
Then Friday morning: March payrolls came in at +178,000 — a substantial rebound from February's revised –133,000, and a significant beat above the Street's consensus of roughly +50,000 to +60,000. Unemployment edged down to 4.3%. Markets closed for Good Friday had no chance to react. Full summary below, but the short version is that this was a genuinely strong number — and it changes the Monday setup considerably from what most expected going into the holiday.
One number conspicuously absent from the rally: oil. WTI crude traded between roughly $95.40 and $99.10 during the four trading days, settling near $98.40 at Thursday's close. No progress on the Strait of Hormuz, no relief at the pump, no change to the Fed's fundamental constraint. The week's equity rally happened in spite of oil, not because of it — which is either encouraging or a setup for a reality check, depending on how Monday goes.
"High-yield bonds gained +1.21% on the week — the strongest segment of the fixed income market. When credit spreads tighten in a week defined by geopolitical uncertainty and a looming payrolls print, it tells you something about underlying risk appetite. Credit markets are not panicking. That matters."
— Vistamark Investment Research Team
Market Performance
The Full Scorecard — Week Ending April 3, 2026
| Asset Class |
Index / Benchmark |
Week |
March 2026 |
Q1 2026 |
Past 12 Mo. |
| Fixed Income |
| Cash | Bloomberg US T-Bills 1–3 Month | +0.08% | +0.3% | +0.9% | 4.1% |
| Short-Term Bonds | Bloomberg US Govt/Credit 1–3 Yr | +0.20% | –0.5% | +0.3% | 4.0% |
| Core Bonds | Bloomberg US Aggregate Bond Index | +0.75% | –1.8% | 0.0% | 4.3% |
| Municipal Bonds | Bloomberg Municipal 1–15 Year | +0.55% | –2.3% | –0.3% | 4.5% |
| High Yield Munis | Bloomberg Municipal High Yield | +0.82% | –1.9% | +0.7% | 2.4% |
| Inflation-Protected | Bloomberg US TIPS (Series-L) | +0.90% | –1.3% | +0.3% | 3.0% |
| Global Bonds | Bloomberg Global Aggregate | +0.78% | –3.1% | –1.1% | 4.3% |
| High Yield Corp. | Bloomberg US Corporate High Yield | +1.21% | –1.2% | –0.5% | 7.0% |
| Long Treasuries | ICE US Treasury 20+ Year Total Return | +1.11% | –4.1% | +0.1% | –0.3% |
| Preferred Securities | S&P/TSX North American Preferred Stock Index | — | –1.1% | +7.1% | –0.1% |
| Global & Broad Equity |
| Global All Cap | MSCI ACWI IMI Net Total Return | +2.91% | –7.3% | –2.7% | 20.6% |
| Global Equity | MSCI ACWI Net Total Return | +2.95% | –7.2% | –3.2% | 20.0% |
| U.S. Equity — Style & Size |
| US Broad Market | Russell 3000 Total Return | +1.64% | –5.0% | –4.0% | 18.1% |
| US Large Cap | S&P 500 Total Return | +1.65% | –5.0% | –4.3% | 17.8% |
| Large Cap Value | Russell 1000 Value Total Return | +1.43% | –4.8% | +2.1% | 15.9% |
| Large Cap Growth | Russell 1000 Growth Total Return | +1.84% | –5.2% | –9.8% | 18.8% |
| Mid Cap | Russell Midcap Total Return | +1.66% | –5.3% | +1.3% | 16.1% |
| Mid Cap Value | Russell Midcap Value Total Return | +1.83% | –5.1% | +3.7% | 17.6% |
| Mid Cap Growth | Russell Midcap Growth Total Return | +1.07% | –6.3% | –6.3% | 9.6% |
| Small Cap | Russell 2000 Total Return | +1.54% | –5.0% | +0.9% | 25.7% |
| Small Cap Value | Russell 2000 Value Total Return | +1.60% | –3.6% | +5.0% | 28.1% |
| Small Cap Growth | Russell 2000 Growth Total Return | +1.47% | –6.3% | –2.8% | 23.6% |
| International Equity |
| Developed Intl. | MSCI EAFE Net Total Return | +3.04% | –10.3% | –1.2% | 21.3% |
| Emerging Markets | MSCI Emerging Markets Net Total Return | +0.33% | –13.1% | –0.2% | 29.6% |
| Other Asset Classes |
| Real Estate | S&P 1500 Real Estate Sector Total Return | +3.01% | –6.2% | +2.1% | 2.4% |
| Precious Metals | Gold — SPDR Gold Shares ETF (GLD) | +7.18% | –11.1% | +8.6% | 49.3% |
| Cryptocurrency | Bitcoin (I:BTCUSD) | –2.76% | +1.2% | –24.6% | –19.0% |
| US Dollar | Invesco DB US Dollar Index Bullish Fund (UUP) | +0.18% | +2.6% | +2.8% | 0.7% |
Sources: YCharts; Bloomberg; S&P Dow Jones Indices LLC; MSCI Inc.; Russell/FTSE; ICE; Bloomberg Index Services Limited. Week ending April 3, 2026. U.S. equity and bond markets closed Good Friday (April 3); equity and fixed income returns reflect the four trading sessions of March 31 – April 2, 2026 (Thursday close). Bitcoin trades continuously and reflects April 3 close. GLD reflects SPDR Gold Shares ETF net asset value. North American Preferred weekly data not available for this publication period. Q1 2026 reflects total return through March 31, 2026. Past performance is not indicative of future results.
A few things are worth pulling out of the table. The global breadth of this week's rally was genuinely striking — every equity geography was positive, every fixed income category was positive. That kind of uniform strength in light holiday-week volume can be a false signal, but it is not nothing. The market was not rotating; it was broadly moving together, and upward.
The international outperformance is worth noting. MSCI EAFE gained +3.04% on the week and is up +21.3% over the trailing twelve months versus the S&P 500's +17.8% — a divergence that has been building since the Q1 energy shock began repricing U.S. growth equity valuations. MSCI ACWI — U.S. plus international combined — gained +2.95% on the week and +20.0% over the past year. (Source: YCharts, MSCI Inc.) Portfolios with maintained non-U.S. exposure look considerably different from those without — which is diversification working as intended, not a prediction that came true.
Gold's +7.18% week deserves its own mention. It is the asset class that most directly tracks the Strait of Hormuz situation, and its sharp weekly gain suggests the market is not pricing in a near-term resolution. Over the trailing twelve months, GLD is up +49.3% — nearly doubling the S&P 500's return over the same period. Note that March was rough for gold too (–11.1%), so this week's bounce is partly recovery, partly fresh demand. Either way, gold is doing exactly what it is supposed to do in this environment.
On the other end: Bitcoin down –2.76% on the week and –24.6% for Q1. It is neither participating in the equity rally nor tracking gold — a reminder that Bitcoin has its own logic, driven more by risk appetite and liquidity flows than by the macro variables that are moving everything else right now. It has never been a safe haven in any traditional sense, and this episode has reinforced that clearly.
One more note on the fixed income side: long Treasuries gained +1.11% on the same week equities rallied +1.65%. Normally those move in opposite directions. When both rise simultaneously, it is the bond market's way of saying it is simultaneously hopeful about the near-term and uncertain about the longer-term economic trajectory. That ambiguity is precisely what Monday's payrolls reaction will start to resolve.
Labor Market · Released April 3, 2026
The March Payrolls Report: What the Number Actually Said
The Bureau of Labor Statistics released the March employment situation report Friday morning at 8:30 a.m. Eastern — on schedule, with markets closed. Here is the summary. Markets will react Monday, but the data itself is public.
March Nonfarm Payrolls
+178K
February Payrolls (Revised)
–133K
Avg. Hourly Earnings (MoM)
+0.2%
Source: Bureau of Labor Statistics, Employment Situation Summary, April 3, 2026. February revised from initial estimate of –101,000. Seasonally adjusted.
The headline: the U.S. economy added 178,000 nonfarm payroll jobs in March — a meaningful rebound from February's revised loss of –133,000, and the strongest print since January. The unemployment rate edged down to 4.3% from 4.4% in February — moving in the right direction.
Here is the number that actually matters for how Monday trades: +178,000 was a significant upside beat. Street consensus heading into the report had clustered around +50,000 to +60,000 — itself a modest expectation reflecting February's weakness and the ongoing energy shock. Coming in at nearly three times that estimate is not a "less bad than feared" story. It is a genuine positive surprise. This likely explains much of the week's rally: markets were pre-pricing a labor market holding up better than feared, and Friday confirmed it decisively.
The sectoral detail reinforces the picture. Health care led the gains, consistent with its role as a recession-resistant employer throughout this cycle. Construction added jobs despite higher borrowing costs — a sign that energy-sector infrastructure spending is absorbing some of the macro shock. Transportation and warehousing posted gains as well, suggesting the logistics sector is adapting to higher fuel costs rather than contracting under them. The notable offset: federal government employment continued to decline, a trend that has been building for several months and partially tempers the headline.
The one number the Federal Reserve will fixate on: average hourly earnings rose +0.2% month-over-month. (Source: BLS Establishment Survey.) This report is unambiguously good news for the economy and, paradoxically, complicates the case for rate cuts even further. A +178,000 print removes the labor-market-deterioration argument for easing entirely. The Fed is now dealing with a triple constraint: resilient payrolls, core PCE above 3%, and $98 oil. There is no combination of those three variables that accelerates rate cuts. If anything, Monday's repricing will likely push the first expected cut further out on the calendar, not closer
"March payrolls at +178,000 is good news for the economy — and challenging news for anyone expecting the Fed to cut rates soon. It removes the labor market deterioration argument for easing at a moment when core PCE is still above 3% and oil is at $98. The Fed's constraint just got tighter, not looser. The good news is the economy is more resilient than February's weakness suggested. The consequence is that rates stay higher for longer."
— Vistamark Investment Research Team
Putting March in Perspective
One Good Week Doesn't Change the Quarter — But Context Matters
The "March 2026" column in the table tells a story that one positive week hasn't erased. The S&P 500 fell –5.0% in March, large-cap growth fell –5.2%, and international markets had a rougher month still. That said, it's worth keeping the numbers in context: a 5% monthly decline, while uncomfortable, is not unusual in periods of macro uncertainty. The Q1 overall return of –4.3% for the S&P 500 puts it in the range of a normal correction — disappointing, but not alarming on its own.
What made Q1 distinctive wasn't the magnitude of the decline so much as the divergence in outcomes. Value strategies, smaller-cap equities, real assets, and gold all held up meaningfully better than large-cap growth. Small Cap Value finished Q1 up +5.0%. Gold (GLD) was up +8.6%. Core bonds returned exactly flat. The energy shock was real — but diversification absorbed a great deal of it. That is the more important story heading into Q2.
Monetary Policy
The Fed's Weekend Was Probably More Complicated Than Yours
"If you don't know where you're going, you might not get there."
— Yogi Berra — a reasonable approximation of the Federal Reserve's current policy framework
The Federal Reserve is watching the payrolls report with the same anticipation as everyone else — and with considerably less ability to respond quickly. The next scheduled FOMC meeting is May 6–7. Between now and then: the market's Monday reaction, April 10 CPI, April 14 PPI, Q1 earnings season, and April 30 GDP and PCE. Each of those data points will either narrow or widen the range of options available to the Fed.
The core constraint hasn't moved — and Friday's payrolls print actually tightened it. Energy-driven inflation is a supply-side shock that rate cuts can't fix. A strong labor market removes the one argument that might have given the Fed permission to look past that inflation. The most likely near-term path remains a hold at May, with language that acknowledges the energy shock's drag on certain sectors without signaling any urgency to ease. What changes Monday is the market's assessment of when the first cut actually arrives — and the direction of that revision is later, not sooner.
Watch the 2-year Treasury yield at Monday's open. With a +178K payrolls beat, the direction of surprise favors yields rising (rate cuts priced further out) rather than falling. A move higher in the 2-year would confirm the market is extending its rate-cut timeline. If the 2-year rises and equities hold anyway, the economy-is-resilient read is winning.
Fed Funds Rate (Current)
3.50–3.75%
Small Cap Value · Q1
+5.0%
High Yield Bonds · Week
+1.21%
May FOMC — Hold Prob.
~90%
CME FedWatch — Rate Probability Snapshot (Pre-Monday Open)
May 6–7
Hold certain; +178K payrolls removes any labor-market argument for cutting while core PCE stays above 3%
~90% hold
June
Strong payrolls pushes cut probability lower; April 10 CPI now the decisive variable for whether June is even in play
~80% hold
September
Remains most realistic window — but only if inflation trends down credibly through Q2; strong jobs makes this conditional
First cut?
Year-End
Strong March print reduces cut probability vs. prior week; Strait of Hormuz remains the dominant swing variable
Updating Mon.
Sources: CME FedWatch Tool (30-Day Fed Funds futures prices). Probabilities as of Thursday April 2 close and subject to material revision at Monday's market open once payrolls are fully digested.
Looking Ahead · Week of April 6
What We Are Watching — In Order of Importance
Priority #1 — Ongoing
Strait of Hormuz — The Single Most Consequential Variable for the Next 3, 6, and 12 Months — Everything else on this list is downstream of what happens here. The Strait of Hormuz is the chokepoint through which roughly one-fifth of the world's daily oil supply transits. Its disruption is the root cause of the energy shock, the inflation spike, the Federal Reserve's bind, and the Q1 drawdown in growth equities. Any credible diplomatic progress toward restored commercial transit would simultaneously reprice oil, inflation expectations, Fed optionality, and equity multiples — all at once, and in a favorable direction. Conversely, every week the Strait remains disrupted is another week the macro pressure compounds. No economic data release, earnings report, or Fed statement comes close to this in terms of 12-month capital market impact. We watch daily tanker traffic volumes and diplomatic developments as our highest-priority indicators.
Monday, April 6 — Market Open & Payrolls Reaction — The first opportunity for equity and bond markets to officially reprice Friday's payrolls print. Futures have been absorbing a +178K print since 8:30 a.m. Friday — a strong beat vs. the ~+55K consensus. Watch the 2-year Treasury yield especially: if it rises on Monday's open, the market is pricing rate cuts further out. If equities hold their gains despite that repricing, it signals the economy-is-resilient read is winning over the less-Fed-support read.
Thursday, April 10 — March CPI — The most important scheduled data release of the month. The first inflation reading to fully capture the energy shock post-February 28. Consensus points to 3.1–3.3% year-over-year headline. Anything above 3.5% materially constrains the Fed's ability to respond to labor weakness. This number effectively determines whether the Fed can pivot — or remains boxed in.
Tuesday, April 14 — March PPI — Producer prices reveal how far upstream the oil shock has traveled before reaching consumers. Transportation and energy sub-components are the key reads. Think of it as a leading indicator for future consumer inflation prints.
Mid-April — Q1 2026 Earnings Season — The major banks lead (JPMorgan, Goldman Sachs, Wells Fargo). EPS growth has been solid on a trailing basis, but guidance is what markets will scrutinize: what are CEOs actually seeing in demand trends, fuel cost exposure, and Q2 hiring intentions under sustained $95–$100 oil?
10-Year Breakeven Inflation — Currently around 2.3% and drifting higher. A sustained move above 2.5% would signal that inflation expectations are beginning to de-anchor — the scenario the Fed fears most and has the least ability to address given the supply-side origin of the shock.
International equity relative performance — EAFE's +21.3% trailing twelve-month return vs. S&P 500's +17.8% is a confirmed trend, not a short-term anomaly. Watch whether non-U.S. markets continue to lead, especially if the dollar softens further. This is one of the clearest expressions of the diversification thesis playing out in real time.
Enjoy the Weekend. Monday Will Take Care of Itself.
Here is what we know: markets had a genuinely solid four-day week. Equities rallied broadly. Credit spreads tightened. Gold surged. International diversification continued to earn its keep. The same positioning that held up best in Q1 — value, smaller-cap, real assets, shorter-duration fixed income — participated in the week's gains without abandoning its structure. That is exactly how a well-constructed portfolio is supposed to behave across different market environments.
Behind the scenes, our VistaBuilder™ and VistaBalancer™ platforms continue to run continuous portfolio optimization and scenario analysis on your behalf. As conditions evolve — whether Monday's open brings volatility or calm — we are actively looking for opportunistic rebalancing moments: trimming what has run, adding to what represents long-term value, and keeping each portfolio aligned with its intended risk profile. We don't wait for a crisis to rebalance. We look for the moments when rebalancing is most advantageous, and we act deliberately.
What you cannot do anything about between now and Sunday evening is Monday's market open. The data is what it is. The Fed will respond as it responds. The Strait situation will develop on its own timeline. None of that is in your control — or ours — this weekend.
What is in your control: sitting at a table with people you love, eating food that is almost certainly better than anything available on a trading floor, and taking a genuine break from the noise. Markets have navigated difficult stretches before. This one is no different in that fundamental respect.
If you want to talk — about what the week's data means for your specific situation, how we're thinking about Q2, or anything in between — reach out anytime. We're here. And from everyone at Vistamark: Happy Easter. Happy Passover. Enjoy the weekend, the family, and whichever end of the table has the better food.
