Tuesday, December 30, 2014

Economic Update for the week of December 30th, 2014

WEEKLY ECONOMIC UPDATE


WEEKLY QUOTE
              
“It is equally offensive to speed a guest who would like to stay and to detain one who is anxious to leave.”
     
- Homer
      
   
WEEKLY TIP
             
The start of the year is a nice time to calculate your net worth. Compile a list of the assets you own and their value; then subtract liabilities (your debts) to figure it out. You may be surprised to learn how wealthy you are.
  
   
WEEKLY RIDDLE
            
It can be measured even though it lacks length, width or height. What is it?

  
Last week’s riddle:
All about but unseen, can be captured but can’t be held, has no throat but can be heard. What is it? 
   
Last week’s answer:
The wind.




December 30, 2014
                       
THE ECONOMY IS BOOMING
Looking at two vital indicators, it becomes hard to draw any other conclusion. In its final estimate, the Commerce Department put Q3 growth at 5.0% – the best quarterly GDP since Q3 2003, following a 4.6% expansion in Q2. Consumer spending was up 3.2% in the third quarter, business investment up 8.9%. Speaking of personal spending, the latest Commerce Department figure on that was also impressive – a November gain of 0.6%, complemented by a gain of 0.4% in personal income. Growth and household spending may not be quite as notable in December or Q4, but the recovery is definitely in full swing.1,2
   
GREAT GROWTH DOESN’T SPUR FALL HOMEBUYING
Existing home sales fell for only the second time in eight months in November, and the decline was sharp: the National Association of Realtors announced a 6.1% slip. New home purchases fell 1.6% last month according to the Census Bureau, marking their first down month since July.3
          
CONSUMER SENTIMENT HOLDS STEADY
At 93.6, the University of Michigan’s last consumer sentiment index reading of 2014 was a tiny bit below expectations. Economists polled by MarketWatch had forecast the final December index to come in at 93.8, unchanged from a month earlier.2
      
THE DOW TAKES IT TO ANOTHER LEVEL
It cleared 18,000 during an abbreviated market week, settling Friday at 18,053.71 thanks to a 1.55% gain across 3½ trading days. Weekly advances also came for the Nasdaq (1.23% to 4,806.86) and S&P 500 (0.88% to 2,088.77). By Friday afternoon, oil prices had sunk under $55 in after-hours trading on the NYMEX; crude lost 3.51% on the week. Gold rallied Friday to trim its 5-day loss to 0.23%; on the COMEX, the yellow metal was at $1,194.40 at week’s end.4
         
THIS WEEK: Nothing major is scheduled on Monday. Tuesday, the Conference Board’s final consumer confidence index of 2014 arrives along with the October edition of the Case-Shiller home price index. On Wednesday, investors will parse the latest initial claims figures and the November pending home sales report from the NAR; U.S. bond markets should close at 2:00pm EST, but the NYSE and NASDAQ will each have a full trading day. Wall Street closes Thursday for New Year’s Day, along with most foreign financial markets; China, however, will present its December factory PMI. Friday sees the release of ISM’s December manufacturing PMI and two key foreign PMIs tracking the Chinese service sector and eurozone manufacturing.
  
% CHANGE
Y-T-D
1-YR CHG
5-YR AVG
10-YR AVG
DJIA
+8.91
+9.55
+14.32
+6.76
NASDAQ
+15.09
+15.35
+22.06
+12.31
S&P 500
+13.01
+13.40
+17.08
+7.34
REAL YIELD
12/26 RATE
1 YR AGO
5 YRS AGO
10 YRS AGO
10 YR TIPS
0.58%
0.80%
1.50%
1.62%
 

Sources: online.wsj.com, bigcharts.com, treasury.gov - 12/26/145,6,7,8
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.


Please feel free to forward this article to family, friends or colleagues.
If you would like us to add them to our distribution list, please reply with their address.
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«RepresentativeDisclosure»
 
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. 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. 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 indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, 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 an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. 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. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. 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 - tinyurl.com/mg2sl49 [12/23/14]
2 - marketwatch.com/economy-politics/calendars/economic [12/23/14]
3 - investing.com/economic-calendar/ [12/23/14]
4 - markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [12/26/14]
5 - markets.wsj.com/us [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F26%2F13&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F26%2F13&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F26%2F13&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F24%2F09&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F24%2F09&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F24%2F09&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F27%2F04&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F27%2F04&x=0&y=0 [12/26/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F27%2F04&x=0&y=0 [12/26/14]       
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [12/26/14]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [12/26/14]

Tuesday, December 23, 2014

Economic Update for the week of December 23rd, 2014

WEEKLY ECONOMIC UPDATE


WEEKLY QUOTE
              
“A well-informed mind is the best security against the contagion of folly and of vice.”
     
- Ann Radcliffe
      
   
WEEKLY TIP
             
As Wall Street is having a good year and the Dow and S&P are hovering near record highs, your portfolio might have a larger allocation to stocks right now than your investment plan stipulates. You may want to rebalance it for 2015 with the goal of lessening exposure to risk.  
  
   
WEEKLY RIDDLE
            
All about but unseen, can be captured but can’t be held, has no throat but can be heard. What is it?

  
Last week’s riddle:
Brothers and sisters, I have none, but this man's father is my father's son. 
   
Last week’s answer:
My son.




December 23, 2014
                       
ONE WORD TURNS STOCKS AROUND
That word was “patient,” and it was found in the Federal Reserve’s December 17 policy statement. The Federal Open Market Committee again pledged to take “a considerable time” to raise interest rates in the absence of easing, but added that it would also be “patient” in making a move. At the central bank’s final press conference of 2014, Fed chair Janet Yellen noted that several FOMC meetings might pass without any increase in the benchmark interest rate. Investors celebrated: the Dow soared 288 points Wednesday and another 421 points Thursday.1,2
    
LOWER PRICES FOR THE HOLIDAYS
Inexpensive gasoline makes life easier for consumers, and its effect was felt in the Consumer Price Index. The CPI’s 0.3% November retreat was its largest monthly pullback in five years. Less inflation pressure gives the Fed less incentive to adjust the federal funds rate.1
               
HOUSING STARTS, BUILDING PERMITS DECLINE
Was it the weather? That could have been one factor for the 1.6% November dip in groundbreaking measured by the Commerce Department. Building permits were down 5.2% last month. November’s decrease snapped three straight months of housing starts at a million-per-year pace, something unseen since early 2008.3
         
A LITTLE PATIENCE GOES A LONG WAY
A long way toward righting the stock market, that is. Thanks largely to the Fed’s reassuring policy statement, the DJIA rose 3.03% across five days to settle at 17,804.80 Friday. Major weekly gains were also logged by the S&P 500 (3.41% to 2,070.65) and NASDAQ Composite (2.40% to 4,765.38). How about oil? Light sweet crude for January delivery climbed 4.4% on the NYMEX Friday, closing at $56.52. Gold lost 2.2% across five days on the COMEX, settling Friday  at $1,196.00.4,5  
         
THIS WEEK: Wall Street considers November existing home sales numbers Monday. Tuesday, the federal government’s final estimate of Q3 growth arrives along with the University of Michigan’s final December consumer sentiment index, reports on November new home buying, consumer spending and hard goods orders and an earnings announcement from Walgreen’s. Wednesday being Christmas Eve, the NYSE and NASDAQ will wrap up trading at 1:00pm EST and the bond market will likely close an hour later. All U.S. financial markets will be closed Thursday for Christmas Day. Friday is a standard trading day on Wall Street; investors will consider new factory output, consumer spending and inflation data from Japan.
  
% CHANGE
Y-T-D
1-YR CHG
5-YR AVG
10-YR AVG
DJIA
+7.41
+10.05
+14.48
+6.70
NASDAQ
+14.10
+17.43
+23.09
+12.40
S&P 500
+12.03
+14.43
+17.56
+7.33
REAL YIELD
12/19 RATE
1 YR AGO
5 YRS AGO
10 YRS AGO
10 YR TIPS
0.49%
0.79%
1.31%
1.62%
 

Sources: online.wsj.com, bigcharts.com, treasury.gov - 12/19/146,7,8,9
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.


Please feel free to forward this article to family, friends or colleagues.
If you would like us to add them to our distribution list, please reply with their address.
We will contact them first and request their permission to add them to our list.


«RepresentativeDisclosure»
 
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. 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. 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 indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, 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 an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. 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. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. 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 - tinyurl.com/ohagdrr [12/19/14]
2 - money.cnn.com/2014/12/18/investing/stocks-markets-fed-oil/ [12/19/14]
3 - bloomberg.com/news/2014-12-16/housing-starts-in-u-s-exceed-1-million-pace-for-third-month.html [12/16/14]
4 - markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [12/19/14]
5 - proactiveinvestors.com/companies/news/58941/gold-up-01-at-1196-wto-jumps-44-to-settle-at-5652-58941.html [12/19/14]
6 - markets.wsj.com/us [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F19%2F13&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F19%2F13&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F19%2F13&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F18%2F09&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F18%2F09&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F18%2F09&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F20%2F04&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F20%2F04&x=0&y=0 [12/19/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F20%2F04&x=0&y=0 [12/19/14]       
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [12/19/14]
9 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [12/19/14] 

Tuesday, December 16, 2014

Economic Update for the week of December 15th, 2014

WEEKLY ECONOMIC UPDATE


WEEKLY QUOTE
              
“Anger makes dull men witty, but it keeps them poor.”
     
- Queen Elizabeth I
      
   
WEEKLY TIP
             
A credit card’s 0% APR interest is not necessarily set in stone. A missed monthly payment may lead to it being rescinded.
  
   
WEEKLY RIDDLE
            
Brothers and sisters, I have none, but this man's father is my father's son. Who am I talking about?

  
Last week’s riddle:
Olivia throws a softball as hard as she can, and even though it doesn’t touch anything and nobody touches it, the softball comes right back to her. How is this possible? 
   
Last week’s answer:
She throws it straight up in the air.




December 15, 2014
                       
AMERICANS BUY MORE, SENTIMENT INDEX SOARS
Commerce Department data showed retail sales jumping 0.7% for November – the best monthly advance recorded in a year. More good news came from the University of Michigan – its initial December consumer sentiment index came in at 93.8, way up from 88.8 at the end of last month. The improvement may reflect relief at falling gas prices as well as added belief in the economy.1
   
WHEN WILL OIL HIT BOTTOM?
Last week saw the International Energy Agency lower its estimates for 2015 global oil demand, and so NYMEX crude for January delivery finished Friday’s trading day at just $57.81 a barrel. At Friday’s close, oil was down 12.94% MTD and 25.90% over the past 30 days. COMEX gold futures, on the other hand, were up 4.75% MTD and settled at $1,222.50 Friday.2,3
               
WHOLESALE PRICES DIP
The Producer Price Index is yet another indicator affected by cheap oil. It declined   0.2% in November, taking the annualized gain down to 1.4%. The core PPI was flat last month and up 1.8% in a year.1
        
CRUDE PRICES DRAG DOWN STOCK PRICES
Bears freely roamed Wall Street last week, with a major selloff occurring Friday. In fact, December 8-12 represented the worst week for the Dow since 2011. The 5-day losses across the major indices were severe: DJIA, 3.78% to 17,280.83; S&P, 3.52% to 2,002.33; NASDAQ, 2.66% to 4,653.60.2,4  
        
THIS WEEK: On Monday, VeriFone reports Q3 results. Tuesday offers a report on November housing starts and building permits and earnings from Darden Restaurants. Wednesday is busier: the Federal Reserve makes a policy statement, the November CPI and the latest euro area CPI arrive, and Carnival, Oracle, FedEx, General Mills and Jabil Circuit report earnings. Thursday, earnings from Rite Aid, Winnebago Industries, Nike, Accenture, Red Hat and ConAgra Foods complement a new report on initial jobless claims. Friday, BlackBerry reports earnings.
  
% CHANGE
Y-T-D
1-YR CHG
5-YR AVG
10-YR AVG
DJIA
+4.25
+9.79
+13.01
+6.24
NASDAQ
+11.42
+16.39
+22.49
+11.66
S&P 500
+8.33
+12.78
+16.20
+6.70
REAL YIELD
12/12 RATE
1 YR AGO
5 YRS AGO
10 YRS AGO
10 YR TIPS
0.46%
0.75%
1.41%
1.65%
 

Sources: online.wsj.com, bigcharts.com, treasury.gov - 12/12/145,6,7,8
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.


Please feel free to forward this article to family, friends or colleagues.
If you would like us to add them to our distribution list, please reply with their address.
We will contact them first and request their permission to add them to our list.


«RepresentativeDisclosure»
 
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. 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. 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 indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, 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 an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. 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. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. 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 - investing.com/economic-calendar/ [12/12/14]
2 - proactiveinvestors.com/companies/news/58785/dow-drops-over-300-pts-to-end-worst-week-in-3-years-58785.html [12/12/14]
3 - money.cnn.com/data/commodities/ [12/12/14]
4 - markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [12/12/14]
5 - markets.wsj.com/us [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F12%2F13&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F12%2F13&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F12%2F13&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F11%2F09&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F11%2F09&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F11%2F09&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F13%2F04&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F13%2F04&x=0&y=0 [12/12/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F13%2F04&x=0&y=0 [12/12/14]       
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [12/12/14]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [12/12/14]