Archived Newsletters

Weekly Economic Update - 5.21.18

RETAIL SALES RISE ANOTHER 0.3%

April’s advance remained at that level. even with car and truck sales removed. It paled compared to the 0.8% March gain reported by the Department of Commerce, but it matched the consensus forecast of economists surveyed by MarketWatch.1

   

APRIL SAW LESS GROUNDBREAKING

An 11.3% drop for apartment construction set the pace of overall housing starts back 3.7% last month, Department of Commerce data noted.2

   

HOME LOAN RATES REACH 7-YEAR HIGH

According to Freddie Mac, the mean interest rate for a 30-year, fixed-rate mortgage last week was 4.61%. That exceeds any number seen since May 2011. Redfin says that the median existing home sold in April spent only 36 days on the market, a sign that buyers have rushed to close quickly before rates climb higher.3

  

RUSSELL 2000 makes HISTORY

The small-cap benchmark notched its third straight record close on Friday, settling at 1,626,63 and rising 1.23% for the week. Blue chips lost 0.47% in five days, with the Dow Jones Industrial Average slipping to 24,715.09 at Friday’s close. The S&P 500 settled 0.54% lower for the week at 2,712.97, and the Nasdaq Composite lost 0.66% in five days, finishing Friday’s trading session at 7,354.34. Through Friday, the big three were all at least 1% higher for the month. Oil ended the week at $71.35 on the NYMEX.4,5

     

THIS WEEK: Nothing major is scheduled for Monday. Advance Auto Parts, AutoZone, Container Store, Cracker Barrel, Hewlett Packard Enterprise, Intuit, Kohl’s, TJX Companies, Toll Brothers, and Urban Outfitters all present earnings Tuesday. April new home sales figures, minutes from this month’s Federal Reserve policy meeting, and earnings from L Brands, Lowe’s, NetApp, Ralph Lauren, Stein Mart, Target, and Williams-Sonoma attract Wall Street’s attention Wednesday. On Thursday, investors react to earnings news from Best Buy, Gap, Hormel Foods, Lionsgate, Medtronic, Ross Stores, Royal Bank of Canada, Shoe Carnival, Stage Stores, TD Bank, and Toro, along with April existing home sales data and a new initial jobless claims report. Friday, the University of Michigan’s final May consumer sentiment index arrives, along with a report on April durable goods orders and earnings from Foot Locker; additionally, Fed chair Jerome Powell joins a panel discussion at a central banking conference in Sweden.

 

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

-0.02

+19.61

+12.19

+8.97

NASDAQ

+6.53

+21.46

+22.04

+19.23

S&P 500

+1.47

+14.68

+12.54

+9.02

REAL YIELD

5/18 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.91%

0.43%

-0.31%

1.36%

 

 


Sources: wsj.com, bigcharts.com, treasury.gov - 5/18/184,5,6,7

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

 

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 - marketwatch.com/economy-politics/calendars/economic [5/18/18]

2 - cnbc.com/2018/05/16/us-housing-starts-april-2018.html [5/16/18]

3 - latimes.com/business/la-fi-high-mortgage-rates-20180517-story.html [5/17/18]

4 - tinyurl.com/y8ao4tbd [5/18/18]

5 - markets.wsj.com/us [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F18%2F17&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F18%2F17&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F18%2F17&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F17%2F13&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F17%2F13&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F17%2F13&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F19%2F08&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F19%2F08&x=0&y=0 [5/18/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F19%2F08&x=0&y=0 [5/18/18]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/18/18]

8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/18/18] 


Weekly Economic Update - 6.25.18

TARIFF TALK INTENSIFIES

Major economic powers proposed additional import taxes last week, as investors wondered if a global trade war was now underway. Monday evening, President Trump stated that he had instructed U.S. Trade Representative Robert Lighthizer to identify another $200 billion of Chinese products to subject to a new 10% import duty. Shortly before the trading week began, the European Union proclaimed it would place import taxes on $3.3 billion of U.S. products, in retaliation to recently imposed metals tariffs. Friday, President Trump mulled imposing a 20% tax on autos arriving from the E.U. unless it lifts such import duties.1,2

   

EXISTING HOME SALES WEAKEN SLIGHTLY

A National Association of Realtors report says that sales tapered off 0.4% in May. While the inventory of homes listed grew 2.8% in the fifth month of the year, the median price of an existing home hit an all-time peak of $264,800. The sales pace was 3.0% slower than in May 2017.3

   

HOUSING STARTS RISE, BUT PERMITS FALL

While home sales were nearly flat last month, groundbreaking increased 5.0% according to the Census Bureau. Its latest report on U.S. residential construction also noted a 4.6% drop in building permits, far exceeding the decline seen in April.4

  

BLUE CHIPS SHED 2%

To be precise, the Dow Jones Industrial Average lost 2.03% last week, sinking to 24,580.89 at Friday’s close even with a 119-point Friday gain. Faring better, the Nasdaq Composite retreated 0.69% to 7,692.82 in the same time frame, while the S&P 500 declined 0.89% to 2,754.88.5

     

THIS WEEK: Investors react to May new home sales data and Q2 earnings from Carnival on Monday. The Conference Board’s June consumer confidence index appears Tuesday, along with the latest S&P CoreLogic Case-Shiller home price index and earnings from Lennar and Sonic. On Wednesday, Wall Street considers the NAR’s May index of housing contract activity, May durable goods orders, and earnings from Bed Bath & Beyond, General Mills, Paychex, and Rite Aid. Thursday, the third estimate of Q1 economic growth arrives, along with the latest initial claims figures and earnings announcements from Accenture, ConAgra Brands, KB Home, Nike, and Walgreens Boots Alliance. May personal spending data, the May PCE price index, and the final June University of Michigan consumer sentiment index emerge Friday, plus earnings from Constellation Brands.

 

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

-0.56

+14.88

+13.22

+10.76

NASDAQ

+11.44

+23.35

+25.83

+22.25

S&P 500

+3.04

+13.16

+14.60

+10.90

REAL YIELD

6/22 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.78%

0.46%

0.59%

1.75%

 

 


Sources: wsj.com, bigcharts.com, treasury.gov - 6/22/185,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 - npr.org/2018/06/18/621227483/trump-asks-for-200-billion-more-in-tariffs-to-impose-on-china [6/18/18]

2 - fortune.com/2018/06/22/trump-tariffs-european-cars/ [6/22/18]

3 - briefing.com/Investor/Calendars/Economic/Releases/exist.htm [6/22/18]

4 - investing.com/economic-calendar/ [6/19/18]

5 - markets.wsj.com/us [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F22%2F17&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F22%2F17&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F22%2F17&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F21%2F13&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F21%2F13&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F21%2F13&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F23%2F08&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F23%2F08&x=0&y=0 [6/22/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F23%2F08&x=0&y=0 [6/22/18]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [6/22/18]

8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [6/22/18]  


Weekly Economic Update - 6.18.18

FED, NEW TARIFFS GET WALL STREET’S ATTENTION

As expected, the Federal Reserve adjusted the target range on the federal funds rate to 1.75%-2.00% on Wednesday. The central bank’s latest dot-plot projection, however, raised some eyebrows: it showed four interest rate increases planned for 2018 instead of three. The median forecast of Fed officials puts the benchmark interest rate at 2.4% at the end of this year, on the way to a peak of 3.4% in 2020. Friday morning, the Trump administration announced new 25% tariffs on at least $34 billion of Chinese imports. Hours later, China retaliated, declaring that it would levy 25% import taxes on a minimum of $34 billion of goods from America. The U.S. and China both plan to implement their new tariffs on July 6.1,2

   

YEARLY INFLATION REACHES 2.8%

The latest Consumer Price Index shows the highest 12-month inflation reading in six years; the core CPI (which leaves out food and fuel costs) rose 2.2% in the year ending in May. Both the headline and core CPI were up 0.2% last month. Wholesale inflation, as measured by the Producer Price Index, increased 0.5% in May.3,4

   

AN IMPRESSIVE ADVANCE FOR RETAIL SALES

According to the Department of Commerce, the May gain was 0.8% (0.9% with car and truck buying factored out). This follows an April improvement of 0.4% (revised up from 0.3%).4

  

A MIXED WEEK FOR THE MAJOR INDICES

Once again, the Nasdaq Composite outran the Dow Jones Industrial Average and S&P 500. Last week, the tech benchmark added 1.32% to settle at 7,746.38 at Friday’s closing bell. The S&P 500 ended up flat for the week (+0.01%) at 2,779.42. At Friday’s close, the Dow Jones Industrial Average had slipped 0.89% in five days to 25,090.48.5

     

THIS WEEK: Nothing major is slated for Monday. Wall Street considers earnings from FedEx, La-Z-Boy, and Oracle on Tuesday, along with the latest Census Bureau snapshot of housing construction activity. Federal Reserve Chairman Jerome Powell discusses monetary policy at a European Central Bank forum on Wednesday morning; investors will also eye earnings from Micron Technology, Steelcase, and Winnebago, and a National Association of Realtors report on existing home sales. Thursday, the Conference Board issues its May leading indicators index, a new initial jobless claims report arrives, and Barnes & Noble, Darden Restaurants, Kroger, and Red Hat present earnings. Friday, Blackberry, and CarMax offer Q1 results.

 

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+1.50

+17.47

+13.30

+10.45

NASDAQ

+12.21

+25.64

+25.25

+21.30

S&P 500

+3.96

+14.26

+14.17

+10.43

REAL YIELD

6/15 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.81%

0.49%

0.09%

1.76%

 

 


Sources: wsj.com, bigcharts.com, treasury.gov - 6/15/185,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 - marketwatch.com/story/fomc-lifts-fed-funds-rate-to-175-2-signals-4-hikes-in-2018-2018-06-13 [6/13/18]

2 - cnbc.com/2018/06/15/china-announces-retaliatory-tariffs-on-34-billion-worth-of-us-goods-including-agriculture-products.html [6/15/18]

3 - bloomberg.com/news/articles/2018-06-12/u-s-consumer-prices-rise-by-most-since-2012 [6/12/18]

4 - briefing.com/investor/calendars/economic/2018/06/11-15 [6/15/18]

5 - markets.wsj.com/us [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F15%2F17&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F15%2F17&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F15%2F17&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F14%2F13&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F14%2F13&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F14%2F13&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F16%2F08&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F16%2F08&x=0&y=0 [6/15/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F16%2F08&x=0&y=0 [6/15/18]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [6/15/18]

8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [6/15/18]  


Weekly Economic Update - 6.11.18

100 MONTHS OF GROWTH FOR SERVICE BUSINESSES

The Institute for Supply Management announced this milestone as it revealed a 58.6 May reading for its non-manufacturing purchasing manager index. That excellent reading was well north of the 56.8 mark seen in April. Fourteen of the fifteen service industries followed by the PMI reported expansion in May; the information sector was the only outlier.1

   

Q2 GDP OUTLOOK BRIGHTENS

Is the economy now expanding at the rate of 5% a year? The bold new estimate by the Federal Reserve Bank of Atlanta nearly says as much. The Atlanta Fed projects a 4.6% GDP reading for Q2. The first quarter saw a 2.2% rate of growth, and the economy grew 2.3% for all of 2017.2

   

SOCIAL SECURITY TO TAP ITS RESERVES THIS YEAR

Last week, Social Security’s trustees announced that the program needs to dip into its trust funds for the first time in 36 years in order to fully fund itself in 2018. In their annual report, the trustees noted that monthly benefits could be reduced as much as 23% by 2034 if no legislative action is taken on Capitol Hill between now and then. The report also noted that Medicare’s hospital insurance fund risks being depleted by 2026; barring a fix, Medicare might only pay out 91% of hospital costs at that point.3

  

NASDAQ ATTAINS RECORD TERRITORY AGAIN

Finishing Friday at 7,645.51, the Nasdaq Composite retreated from its historic closes on Monday, Tuesday, and Wednesday of last week. Even so, it gained 1.21% across five trading sessions. The S&P 500 added 1.62% last week to settle at 2,779.03 Friday. The Dow Jones Industrial Average? It rose 2.77% for the week, reaching 25,316.53 at Friday’s closing bell.4,5

     

THIS WEEK: Nothing major is scheduled on Monday. The May Consumer Price Index appears Tuesday, plus earnings from H&R Block. Wednesday, Wall Street awaits a Federal Reserve interest rate decision and considers the May Producer Price Index. May retail sales numbers appear Thursday, in addition to a new initial jobless claims report and quarterly results from Michaels Companies. On Friday, the University of Michigan releases its preliminary June consumer sentiment index.

 

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+2.42

+19.52

+13.21

+10.62

NASDAQ

+10.75

+20.94

+24.08

+21.09

S&P 500

+3.94

+14.19

+13.82

+10.41

REAL YIELD

6/8 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.82%

0.41%

0.03%

1.54%

 

 


Sources: wsj.com, bigcharts.com, treasury.gov - 6/8/185,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

 

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 - nytimes.com/aponline/2018/06/05/us/politics/ap-us-economy-services.html [6/5/18]

2 - cnbc.com/2018/06/08/gdp-for-second-quarter-on-track-to-double-2018-full-year-pace-of-2017.html [6/8/18]

3 - marketwatch.com/story/new-warnings-about-cuts-to-social-security-and-medicare-are-a-reason-to-worry-2018-06-07 [6/7/18]

4 - reuters.com/article/us-usa-stocks/tesla-drives-fourth-day-of-gains-for-nasdaq-banks-up-idUSKCN1J21E8 [6/6/18]

5 - markets.wsj.com/us [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F8%2F17&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F8%2F17&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F8%2F17&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F7%2F13&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F7%2F13&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F7%2F13&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F9%2F08&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F9%2F08&x=0&y=0 [6/8/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F9%2F08&x=0&y=0 [6/8/18]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [6/8/18]

8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [6/8/18] 

 


Weekly Economic Update - 6.4.18

HIRING, HOUSEHOLD SPENDING STRENGTHEN

Net job growth surprised to the upside in May: companies added 223,000 more workers than they laid off or fired. At 3.8%, the unemployment rate is now where the Federal Reserve thought it would be at the end of 2018, and it is also at its lowest level since April 2000. Underemployment, as measured by the Department of Labor’s U-6 jobless rate, fell 0.2% in May to a 17-year-low of 7.6%. Year-over-year wage growth was measured at 2.7% in this latest labor market snapshot. In another sign of a strong economy, the Department of Commerce said that consumer spending grew by a noteworthy 0.6% in April, with consumer incomes rising 0.3%.1,2

   

CONSUMER CONFIDENCE REBOUNDS

The Conference Board’s closely watched consumer confidence index improved to 128.0 in May, rising 2.4 points from its April mark. Analysts polled by MarketWatch expected a reading of 127.5.2

   

FACTORY SECTOR CONTINUES TO BOOM

Growth picked up in U.S. manufacturing last month, according to the Institute for Supply Management’s May purchasing manager index. At an impressive reading of 58.7, the PMI was 1.4 points better than it was in April and matched its average reading over the past 12 months. The index has not been below 56.5 for a year. Any reading above 50.0 indicates expansion.3

  

WALL STREET SHRUGS AT NEW IMPORT TAXES

The Trump administration is following through on its pledge to impose tariffs on metals imported from Mexico, Canada, and the European Union – and all those trading partners are responding in kind. Incipient trade war or not, investors felt confident last week – confident enough to send the Nasdaq Composite another 1.62% higher in four days. The S&P 500 added 0.49% in those four sessions, but the Dow Jones Industrial Average fell 0.48% last week. Their respective Friday settlements: Dow, 24,635.21; Nasdaq, 7,554.33; S&P, 2,734.62.4,5

     

THIS WEEK: On Monday, Apple kicks off its weeklong 2018 developer conference, and Dell Technologies and Palo Alto Networks announce earnings. The ISM service sector PMI appears Tuesday. Wednesday, Thor Industries reports quarterly results. On Thursday, Wall Street reviews the latest initial jobless claims data and earnings from Broadcom and J.M. Smucker. Friday, nothing major is scheduled.

 

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

-0.34

+16.51

+12.60

+9.70

NASDAQ

+9.43

+20.93

+23.72

+20.32

S&P 500

+2.28

+12.53

+13.54

+9.74

REAL YIELD

6/1 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

0.80%

0.40%

-0.05%

1.51%

 

 


Sources: wsj.com, bigcharts.com, treasury.gov - 6/1/185,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 - reuters.com/article/us-usa-economy/u-s-job-growth-surges-unemployment-rate-falls-to-3-8-percent-idUSKCN1IW1NX [6/1/18]

2 - marketwatch.com/economy-politics/calendars/economic [6/1/18]

3 - instituteforsupplymanagement.org/ISMReport/MfgROB.cfm?SSO=1 [6/1/18]

4 - thestreet.com/markets/stocks-post-sharp-gains-after-jobs-report-14607822 [6/1/18]

5 - markets.wsj.com/us [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F1%2F17&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F1%2F17&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F1%2F17&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F31%2F13&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F31%2F13&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F31%2F13&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F2%2F08&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F2%2F08&x=0&y=0 [6/1/18]

6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F2%2F08&x=0&y=0 [6/1/18]

7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [6/1/18]

8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [6/1/18] 

  



Earl Schultz and Shannon LaRosse are investment adviser representatives of, and securities and advisory services are offered through, USA Financial Securities Corp., Member FINRA/SIPC. www.finra.org A Registered Investment Adviser located at 6020 E. Fulton St., Ada, MI 49301. Strategic Wealth Advisory is not affiliated with USA Financial Securities.

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