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WEEKLY QUOTE
“Rudeness
is the weak man’s imitation of strength.”
- Eric Hoffer
WEEKLY TIP
50
or older this year? Take advantage of increased “catch-up” contributions with
your retirement accounts. If your contributions are pre-tax, you will be
saving tax dollars along the way.
WEEKLY RIDDLE
I
sleep by day and fly by night, with no feathers to aid my flight. What am I?
Last week’s riddle:
What comes at the end of a rainbow?
Last week’s answer:
The letter W.
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January 20,
2015
WHAT HAPPENED TO RETAIL SALES?
Wall
Street was surprised by the news of December’s 0.9% retreat, especially given
November’s (revised) 0.4% advance. Minus auto buying, the decline was 1.0%. Economists
surveyed by Briefing.com had forecast a gain of 0.1%. The plunge came even
with holiday sales, cheap gas, strong hiring and increasing optimism about
household economic prospects (see below). This disappointment raises concerns
about the strength of Q4 consumer spending.1,2
CONSUMER PRICES TAKE A BIG DIP
December saw the Consumer Price Index decrease 0.4%, its
largest monthly pullback since December 2008. That brought its
2-month decline to 0.7%. Falling gas prices were a major influence, of course
– on Friday, AAA announced a nationwide average price of just $2.08 for a
gallon of regular unleaded. The University of Michigan’s consumer sentiment index
hit an 11-year peak last week with a preliminary mark of 98.2.1
DRAMA FOR CURRENCIES, A BIG GAIN FOR
GOLD
The Swiss National Bank rocked the currency
markets Thursday by abruptly lifting its cap on its franc. In the minutes
after the announcement, the Swiss franc gained 25% on the dollar and 30%
against the euro while Germany’s DAX index fell 250 points. Perhaps the SNB anticipates
a stimulus from the European Central Bank. COMEX gold futures were
up 4.5% last week to $1,276.90 at Friday’s close; WTI crude settled at $48.69
on the NYMEX Friday.3,4
NO WEEKLY GAIN FOR THE S&P 500
It lost 1.24% across five volatile days to close at
2,019.42 Friday. No 5-day advances came for the Nasdaq or Dow either: the
former gave back 1.48% to end the week at 4,634.38, the latter 1.27% to
settle at 17,511.57 at Friday’s final bell.5
THIS WEEK: On
Monday, U.S. financial markets are closed in observance of the birthday of Dr.
Martin Luther King, Jr. Tuesday sees IBM and Netflix release earnings. Wednesday,
earnings from U.S. Bancorp, eBay and Deluxe Corp. complement the Census
Bureau’s December report on housing starts and building permits. Thursday offers
earnings from Southwest Airlines, Verizon, Key Corp., Starbucks and Union
Pacific and new initial claims figures. Friday brings December existing home
sales data from NAR, the Conference Board’s latest leading indicator index
and earnings from Honeywell, GE, State Street Corp. and McDonald’s.
Sources: online.wsj.com, bigcharts.com, treasury.gov - 1/16/156,7,8,9
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.
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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 - businessweek.com/news/2015-01-16/consumer-sentiment-in-u-dot-s-dot-surges-to-11-year-high-as-fuel-drops
[1/16/15]
2 - briefing.com/investor/calendars/economic/2015/01/12-16 [1/16/15]
3 - tinyurl.com/kyk96kq [1/15/15]
4 - proactiveinvestors.com/companies/news/59328/gold-gains-1-to-1276-wti-up-at-4869-59328.html
[1/16/15]
5 - markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp
[1/16/15]
6 - markets.wsj.com/us [1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F16%2F14&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F16%2F14&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F16%2F14&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F15%2F10&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F15%2F10&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F15%2F10&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F18%2F05&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F18%2F05&x=0&y=0
[1/16/15]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F18%2F05&x=0&y=0
[1/16/15]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield
[1/16/15]
9 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll
[1/16/15]
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Tuesday, January 20, 2015
Economic Update for the week of January 20th, 2015
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