April started with President Obama’s avowed unparalleled government control over the auto industry, rejecting turnaround plans from General Motors (GM) and Chrysler, while hinting at the prospect of a controlled bankruptcy for the ailing auto giants.

General Motors Corp. (GM) suggested that the company could be majority owned by the federal government, following a restructuring plan laid out that would cut 21K factory jobs by next year and phase out the storied Pontiac brand. Furthermore, Chrysler filed for bankruptcy protection during April and announced a temporary stoppage to most of its vehicle production while it attempts to complete a deal with Italian carmaker Fiat.

In addition, startling news out of Mexico, in which an outbreak of swine flu spread into the U.S. and other regions throughout the world, had investors extremely concerned with the outbreaks’ potential to curtail economic recovery, especially within those industries that rely heavily on travel and tourism.

The nation’s economy contracted at a worse-than-anticipated rate during the 1Q, as businesses made enormous cutbacks and exports showed the biggest decline in more than 40 years. During the quarter, GDP plunged at a 6.1% clip, nearly as bad as the 4Q reading when the economy shrank at a 6.3% rate.

In the meantime, the U.S. trade deficit contracted in February to the lowest level in more than nine years as the recession curtailed imports, pushing it down for a seventh straight month while U.S. exports managed a small rebound. The deficit dropped a sharp 28.3% to $25.97B, the smallest margin since November 1999 and the seventh consecutive month the trade deficit has declined.

Meanwhile, consumer spending in March fell for the first time in three months, falling 0.2%. Incomes, following massive waves of layoffs, slipped 0.3%.

U.S. factory orders increased for the first time in six months, posting a gain of 1.8% in February. For the month of March, orders for durable goods dropped 0.8%, while orders for nondurable goods, products such as petroleum, chemicals and paper, dropped 1% after a 0.2% decrease in February.

The nation’s industrial production in March contracted for the fifth consecutive month, as production at mines, factories, and utilities slipped 1.5%, matching February’s decline. Mines and factories appear to remain relatively stagnant during the recession, as the total capacity utilization rate declined to 69.3%

Furthermore, the Institute of Supply Management (ISM) revealed that the manufacturing sector receded in March, marking the 14th straight month of contraction with a reading of 36.3, after posting a 28-year low of 32.9 in December.

Construction spending for February retreating for the fifth straight month, as the housing industry continues to be stuck in the mire. For the month, spending fell 0.9%, while housing construction plunged 4.3%, signaling its weakest level in more than 11 years. In non-residential construction, spending increased marginally by 0.3%, following a 4.3% decline in January, its largest drop in 15 years.

Foreclosures throughout the U.S. jumped 24% during the 1st quarter with more than 800K homes receiving at least one foreclosure notice, up from 650K during last year’s 1Q. In March alone, more than 340K properties received notices, up 17% from February and more than 45% higher than this time last year.

The National Association of Realtors (NAR) confirmed that existing home sales plunged 3% in March to an annual rate of 4.57M, from a downwardly revised pace of 4.71M units in February. Meanwhile, the median sales price retreated to $175K, down 12.4% from $200K a year earlier, but up from $168K in February.

New U.S. home sales dipped slightly, falling 0.6% in March to a seasonally adjusted annual rate of 356K, compared to an upwardly revised February rate of 358K. However, the median sales price of new homes declined to $201K, a 12% drop from a year earlier. There were 311K new homes for sale at the end of March, down 5.2% from 328K in February.

In addition, pending home sales in February increased 2.1%, in line with analysts’ expectations, to a reading of 82.1, following January’s record low of 80.4.

Adversely, home prices in February dropped once again, as the 20-city index saw prices plunge 18.6%, while the 10-city index receded by 18.8%. Since its peak, set back in the summer of 2006, the 20-city index has seen prices drop nearly 31%, while the 10-city index has fallen almost 32%.

The Producer Price Index (PPI), which measures the change in price before reaching the consumer, declined 1.2%, as the price of gas, food and heating oil receded. The reading followed February’s slight increase of 0.1%, as the decline in prices was propelled by the sharp decrease in food and energy prices. Food costs fell 0.7%, while gas prices plunged more than 13%.

The Consumer Price Index (CPI), which showed a drop in prices for March, fell 0.1% led by a decline in energy prices. During the past year, consumer prices have dropped 0.4%, marking the first yearly decline in prices since August 1955. The Core CPI reading increased 0.2% during March, totaling the overall gains over the previous three months. Over the past year, core inflation has increased 1.8%.

In the interim, wholesale inventories, which dropped by their steepest amount during February, fell 1.5%, marking the sixth straight month of declines and the most on record since January 1992. In February, however, wholesale sales increased by 0.6%, the first advance since last June and a huge turnaround from the 2.4% decline in sales from January.

One of the most influential economic data releases in April was the nation's unemployment rate jumping to 8.5% in March, the highest since late 1983, as employers slashed 663K jobs, while the number of unemployed people surged to 13.2M in March. If part-time and discouraged workers were factored into the equation, the unemployment rate would have been 15.6% in March, the highest on record dating back to 1994.

There were, however, rising hopes throughout the month. Consumer confidence in April jumped more than 12 points to a reading of 39.2, well above March’s revised reading of 26.9 and the highest mark since last November. Despite the increase in confidence, if companies continue to lay-off workers, consumers will still tighten their wallets in reaction to an increase in unemployment.

By the conclusion of the month, the major indices were in the middle of three-month run-up in the markets. Posting some of the largest monthly gains in years, the Dow Jones finished the April up more than 7%, adding nearly 560 points to end at 8,168.12. Meanwhile, the broader market indicators were deep in the green as well. The S&P 500 surged 9.4% for the month, gaining just under 75 points to close out at 872.81, while the NASDAQ was the month’s biggest beneficiary, jumping more than 12% in value, adding 188.71 points to conclude April at 1,717.30.