Major markets wavered last week. While the economy may have actually contracted in Q1, it appears to have regained momentum. Expanding at a 3.3% annualized pace this quarter.

Ukraine continues to be the story as buildings were set ablaze, helicopters shot down and blood was shed. Geneva's multi-party agreement is yesterday's news. And separatists claimed victory in disputed referendums in Eastern Ukraine.

Moreover, Russia's economy seems to be slowing further amid increasing international isolation. And Russia's slowing economy may be affecting the European companies with which it has ties.

The Good

Q1 earnings continued to be solid. With 445 of the 500 S&P companies having reported Q1 earnings, 68.2% beat expectations, besting the long-time average of 63%.

The Bad

The price of oil rose above $100 a barrel, and small-cap stocks furthered their underperformance compared to the larger U.S. benchmarks - though they soared higher yesterday.

The Bottom Line

Stocks were rolling along on the wings on monetary policy, low inflation and a mild economic recovery. Recently, the cycle has turned and provided plenty of ammo for both bulls and bears. We expect to see both sides fight it out until one overwhelms the other and this market revisits its march lows or breaks through the 1900 barrier on the S&P.

Weekly Results

Major markets finished mixed last week. The DJIA gained 0.43%, the S&P 500 fell 0.14%, and the Nasdaq declined 1.26%.  Small cap stocks dropped 1.91%.  And the 10-year Treasury bond yield added 3 basis points, finishing at 2.62%. Gold lost $10.52 per ounce, or 0.81%.