Wednesday, December 27, 2017

Economic Update for the week of December 27th, 2017

WEEKLY ECONOMIC UPDATE


WEEKLY QUOTE
              
“Do what you can, with what you have, where you are.”
     
- Teddy Roosevelt
      
   
WEEKLY TIP
             
Under 30? Now is the time to automate your saving and investing, so you can take advantage of compounding. Many baby boomers and Gen Xers wish they had started investing in their twenties.
     
  
WEEKLY RIDDLE
            
Emily takes a picture at an art museum in Michigan. Why is she subsequently told not to leave the museum?
   

Last week’s riddle:
Had by some and treasured by all, it is found inside and outside and makes many fall. Can you name what it is? 
     
Last week’s answer:
Beauty.



December 27, 2017
   
LANDMARK FEDERAL TAX CHANGES SLATED FOR 2018
Congress passed the Tax Cuts & Jobs Act last week, and President Trump signed the bill into law on Friday. The new legislation authorizes major changes to the Internal Revenue Code. On January 1, 2018, the corporate tax rate will be reduced to 21%, most pass-through businesses will be allowed to claim a 20% deduction on earnings, the estate tax exemption will double, the individual standard deduction will rise to $12,000, and personal exemptions will disappear. At the start of 2019, the health insurance requirement for individuals set by the Affordable Care Act is scheduled for repeal. Most of the reforms are slated to sunset at the end of 2025.1
   
HOME SALES STRENGTHEN
The National Association of Realtors reported a 5.6% rise in residential resales in November, complementing last month’s 17.5% gain in new home buying announced by the Census Bureau. In a separate report, the Bureau found housing starts up 3.3% for November, with building permits down 1.4%.2
  
CONSUMER SPENDING JUMPS 0.6% IN NOVEMBER
Beside this noteworthy gain, the Department of Commerce also documented a 0.3% rise in personal income last month. Turning to consumer sentiment, the University of Michigan’s final December index declined 0.9 points from its preliminary reading to 95.9. In further consumer-linked news, the Bureau of Economic Analysis issued its last estimate of Q3 GDP, reducing it 0.1% to 3.2%.2
  
SMALL GAINS ON WALL STREET
As last week’s performance of the S&P 500 demonstrated, tax reform was already priced into U.S. equities. The benchmark advanced but 0.28% across five days, settling Friday at 2,683.34. In quiet trading, the Nasdaq Composite gained 0.34% for the week while the Dow Jones Industrial Average rose 0.42%. The Nasdaq finished the week at 6,959.96; the Dow, at 24,754.06. Bitcoin took a 27% intraday dive Friday, falling to $11,833 before recovering to $14,241 by Wall Street’s closing bell.3,4
      
THIS WEEK: U.S. financial markets are closed on Christmas Day. Trading resumes Tuesday, which is also the release date for the October S&P/Case-Shiller home price index. Wednesday, the Conference Board’s latest consumer confidence snapshot arrives, along with the NAR’s November pending home sales index. A new initial jobless claims report surfaces Thursday. Friday, nothing major is scheduled.
  
% CHANGE
Y-T-D
1-YR CHG
5-YR AVG
10-YR AVG
DJIA
+25.26
+24.27
+17.53
+8.40
NASDAQ
+29.29
+27.77
+26.08
+15.85
S&P 500
+19.85
+18.68
+17.53
+8.08
REAL YIELD
12/22 RATE
1 YR AGO
5 YRS AGO
10 YRS AGO
10 YR TIPS
0.54%
0.60%
-0.71%
1.84%
 

Sources: wsj.com, bigcharts.com, treasury.gov - 12/22/173,5,6,7
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.


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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. 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 - cpapracticeadvisor.com/news/12388205/2018-tax-reform-law-new-tax-brackets-credits-and-deductions [12/22/17]
2 - investing.com/economic-calendar/ [12/22/17]
3 - markets.wsj.com/us [12/22/17]
4 - washingtonpost.com/news/the-switch/wp/2017/12/22/bitcoin-tumbles-nearly-30-percent-in-volatile-trading/ [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F22%2F16&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F22%2F16&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F22%2F16&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F21%2F12&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F21%2F12&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F21%2F12&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F21%2F07&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F21%2F07&x=0&y=0 [12/22/17]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F21%2F07&x=0&y=0 [12/22/17]
6 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [12/22/17]
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [12/22/17]

Wednesday, December 13, 2017

Economic Update for the week of December 13th, 2017

WEEKLY ECONOMIC UPDATE


WEEKLY QUOTE
              
“One’s dignity may be assaulted, vandalized and cruelly mocked, but it can never be taken away unless it is surrendered.”
     
- Michael J. Fox
      
   
WEEKLY TIP
             
Consider buying used capital equipment in good condition for your company rather than new equipment. Sometimes, lenders will auction off assets from foreclosed businesses. Through such auctions, you could, potentially, realize big savings.
     
  
WEEKLY RIDDLE
            
What flies without any wings? 
   

Last week’s riddle:
What round, white container hides a tasty delight within it, and requires no keys to open? 
     
Last week’s answer:
An egg.



December 11, 2017
   
ANOTHER MONTH OF SOLID HIRING
According to the Department of Labor, the U.S. workforce gained 228,000 more jobs than it lost during November. Annualized wage growth improved from 2.5% to 2.7%. The headline jobless rate held at 4.1% last month, while the U-6 rate, that includes the underemployed, ticked up a tenth of a percent to 8.0%. Even though October’s net job gain was revised down to 244,000, October-November 2017 represents the best two-month hiring period in more than a year.1,2
   
ISM INDEX MISSES EXPECTATIONS
The Institute for Supply Management’s gauge of service sector activity fell 2.7 points to a still-impressive reading of 57.4 in November. Economists polled by Briefing.com expected a retreat, albeit a lesser one: they projected a reading of 59.3.2
  
A SMALL DECLINE FOR CONSUMER SENTIMENT
There was just a bit less optimism in households in early December, at least by the measure of the University of Michigan’s twice-monthly Surveys of Consumers. The preliminary December edition of the university’s consumer sentiment index fell 1.7 points from its final November reading to a mark of 96.8.2
  
TWO OF THREE MAJOR INDICES RISE
Once again, the Nasdaq Composite gave up ground across five trading sessions while the S&P 500 and Dow Jones Industrial Average advanced. The tech benchmark lost only 0.11% last week on its way to a 6,840.08 Friday close. The same stretch brought gains of 0.40% for the Dow and 0.35% for the S&P; their respective Friday settlements were 24,329.16 and 2,651.50. Dropping 16.19% last week, the CBOE VIX volatility gauge went back under 10, closing Friday at 9.58. Settling at 1,521.72 Friday, the small-cap Russell 2000 lost 1.00% for the week.3
      
THIS WEEK: Casey’s General Stores announces Q3 earnings Monday. Tuesday, the November Producer Price Index comes out, and Verifone presents Q3 results. The Federal Reserve is widely expected to raise the benchmark interest rate Wednesday; the November Consumer Price Index also appears for Wall Street’s consideration. Thursday brings federal government reports on initial jobless claims and November retail sales, plus earnings from Costco and Jabil Circuit. A Federal Reserve report on November industrial output arrives Friday.
  
% CHANGE
Y-T-D
1-YR CHG
5-YR AVG
10-YR AVG
DJIA
+23.11
+24.03
+16.99
+7.86
NASDAQ
+27.07
+26.26
+25.94
+15.28
S&P 500
+18.43
+18.04
+17.40
+7.62
REAL YIELD
12/8 RATE
1 YR AGO
5 YRS AGO
10 YRS AGO
10 YR TIPS
0.50%
0.45%
-0.86%
1.86%
 

Sources: wsj.com, bigcharts.com, treasury.gov - 12/8/173,4,5,6
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. 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.  The Russell 2000 measures the performance of approximately 2000 small-cap companies in the Russell 3000 Index, which is made up of 3000 of the biggest U.S. stocks. The CBOE Volatility Index® (VIX® Index®) is a key measure of market expectations of near-term volatility conveyed by S&P 500 stock index option prices. The 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 - fortune.com/2017/12/08/november-job-report-unemployment-rate/ [12/8/17]
2 - briefing.com/investor/calendars/economic/ [12/8/17]
3 - markets.wsj.com/us [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F8%2F16&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F8%2F16&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F8%2F16&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F7%2F12&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F7%2F12&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F7%2F12&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F7%2F07&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F7%2F07&x=0&y=0 [12/8/17]
4 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F7%2F07&x=0&y=0 [12/8/17]
5 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [12/8/17]
6 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [12/8/17]

Thursday, December 7, 2017

Economic Update for the week of December 7th, 2017

WEEKLY ECONOMIC UPDATE


WEEKLY QUOTE
              
“My father used to say, ‘Let them see you and not the suit.’”
     
- Cary Grant
      
   
WEEKLY TIP
             
Did you just get a great business idea? If you have a product or service offering that you sense your customers will find irresistible, perhaps they could help you finance it. Consider presenting it through a subscription model or have customers pay for the goods or services in advance.
     
  
WEEKLY RIDDLE
            
What round, white container hides a tasty delight within it and requires no keys to open? 
   

Last week’s riddle:
Tom figures out that an old grandfather clock is one minute fast every hour. How can Tom manipulate the clock to tell the correct time twice a day, while keeping it running at the same pace? 
     
Last week’s answer:
By making it run backwards.



December 7 2017
   
CONSUMERS ACT ON THEIR CONFIDENCE
A new factoid points out just how well the economy is doing: the federal government just upgraded its estimate of third-quarter growth to 3.3%. New data on consumer spending and confidence hints at fourth-quarter strength. Personal spending improved 0.3% in October following the 0.9% leap in September, and household wages were up 0.4% in October for a second straight month. At a mark of 129.5, the Conference Board’s consumer confidence index reached a YTD peak in November, having soared 9.1 points in two months.1,2
  
TWO VERY POSITIVE HOUSING SIGNALS
New homes are selling strongly. October saw a 6.2% advance for new home buying according to the Commerce Department, with sales up 30% in the Northeast; the annualized rate of new home purchases was the best in a decade. In addition, the National Association of Realtors announced a 3.5% gain in its pending home sales index for October, a turnaround from the 0.4% September decline.1,3
  
MANUFACTURING SECTOR MAINTAINS A HECTIC PACE
The Institute for Supply Management’s October factory sector purchasing manager index came in at 58.2 last week – a sign of significant expansion. That was half a point below its September reading, but still far above the 50.0 dividing line between sector growth and contraction.4
  
MORE UPS THAN DOWNS ON WALL STREET
News from the nation’s capital affected equity index performance more than anything else as November ebbed into December. When the closing bell called an end to a rollercoaster trading day on Friday, the weekly numbers looked better for the Dow Jones Industrial Average (+2.86% to 24,231.59) and S&P 500 (+1.53% to 2,642.22) than for the Nasdaq Composite (-0.60% to 6,847.59). The CBOE VIX volatility index climbed 18.20% for the week to 11.43.5
      
THIS WEEK: Monday, no major economic news items are scheduled. On Tuesday, a new ISM service sector PMI arrives, plus earnings from AutoZone, Bank of Montreal, Land’s End, and Toll Brothers. Wednesday, ADP issues its November payrolls report; investors also review earnings from American Eagle Outfitters, Analogic, H&R Block, Broadcom, Fred’s, Hudson’s Bay Co., and Lululemon Athletica. Thursday offers the latest Challenger job-cut report, a new weekly initial claims report, and earnings from Dell Technologies, Dollar General, and Toro. Wall Street considers the Department of Labor’s November employment report Friday along with the initial University of Michigan consumer sentiment index for December.
  
% CHANGE
Y-T-D
1-YR CHG
5-YR AVG
10-YR AVG
DJIA
+22.61
+26.26
+17.21
+8.12
NASDAQ
+27.20
+30.40
+25.50
+15.73
S&P 500
+18.02
+20.59
+17.31
+7.84
REAL YIELD
12/1 RATE
1 YR AGO
5 YRS AGO
10 YRS AGO
10 YR TIPS
0.51%
0.48%
-0.79%
1.63%
 

Sources: wsj.com, bigcharts.com, treasury.gov - 12/1/175,6,7,8
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. 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 [12/1/17]
2 - bloomberg.com/quote/CONCCONF:IND [12/1/17]
3 - thestreet.com/story/14403381/1/with-real-sector-booming-what-housing-sector-stocks-will-pop-.html [11/27/17]
4 - instituteforsupplymanagement.org/ismreport/mfgrob.cfm?SSO=1 [12/1/17]
5 - markets.wsj.com/us [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=12%2F1%2F16&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=12%2F1%2F16&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=12%2F1%2F16&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F30%2F12&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F30%2F12&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F30%2F12&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F30%2F07&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F30%2F07&x=0&y=0 [12/1/17]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F30%2F07&x=0&y=0 [12/1/17]
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [12/1/17]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [12/1/17]