In this week’s recap: the Dow returns to
record territory, home sales flatten, housing starts surge, and the price of
oil rises.
Weekly Economic Update
Presented by Troy L. Thompson, CFP, September 24, 2018
BLUE
CHIPS HIT A 2018 HIGH
On Thursday, the Dow Jones Industrial Average
saw its best close since January. Friday took the index even higher, to another
record settlement of 26,743.50. That capped a 2.25% weekly advance. The Dow was
not the only major benchmark shattering records last week. The S&P 500 also
settled at a historic peak Thursday before drifting slightly lower to 2,929.67
a day later; in five days, it rose 0.85%. For the Nasdaq Composite, the story
was different: it declined 0.29% last week to 7,986.96.1,2
AUGUST
WAS A FLAT MONTH FOR HOME BUYING
The National Association of Realtors declared
the pace of existing home sales unchanged from July in its August snapshot of
the residential real estate market. Economists surveyed by Reuters anticipated
an advance of 0.3% after four consecutive months of retreats. Sales were down
1.5%, year-over-year, through August, but existing home inventory grew 2.7%
during the same 12 months; that marked the first annualized increase in the
supply of homes for sale since 2015. The median existing home price in August:
$264,800, 4.6% higher than a year ago.3
HOUSING
STARTS JUMP; BUILDING PERMITS FALL
Starts and permits went opposite ways during
August, according to the Census Bureau’s latest look at U.S. residential
construction activity. Groundbreaking increased 9.2% in the eighth month of the
year, but permits for new developments declined by 5.7%.4
OIL
CLIMBS TO A 2-MONTH PEAK
WTI crude settled at $70.78 per barrel on the
New York Mercantile Exchange on Friday, charging 2.6% for the week. This was
crude’s best closing price since July 13, preceding a critical meeting of OPEC
nations and their allies to address potential supply problems in the fourth quarter.5
T I P O F
T H E W E E K
In a two-parent household, both parents may want to consider life insurance coverage, even if one of them does not work. Money from the life insurance policy can help a surviving spouse pay for child care and education expenses.
THIS WEEK
Monday offers no major
earnings calls or economic reports. | The Conference Board’s latest consumer
confidence index arrives Tuesday, plus a new S&P CoreLogic Case-Shiller
home price index and earnings from Cintas, Jabil, KB Home, and Nike. | The
Federal Reserve makes an interest rate decision Wednesday; in addition, August
new home sales figures and earnings from Bed Bath & Beyond, CarMax, and
Worthington Industries appear. | Accenture, ConAgra Brands, and Rite Aid
present earnings Thursday, complementing the latest initial jobless claims
numbers, the third estimate of Q2 economic expansion, and reports on August
housing contract activity and hard goods orders. | Friday, August personal
spending figures are released, plus the August PCE price index, the final
September consumer sentiment index from the University of Michigan, and
earnings from BlackBerry.
Q U O T E O F T H E W E E K
“Learning to ignore things is one of the
great paths to inner peace.”
Robert J. Sawyer
% CHANGE
|
Y-T-D
|
1-YR CHG
|
5-YR AVG
|
10-YR AVG
|
DJIA
|
8.19
|
19.61
|
14.62
|
14.28
|
NASDAQ
|
15.70
|
24.36
|
22.32
|
26.65
|
S&P 500
|
9.58
|
17.16
|
14.27
|
14.27
|
REAL YIELD
|
9/21 RATE
|
1 YR AGO
|
5 YRS AGO
|
10 YRS AGO
|
10
YR TIPS
|
0.92
|
0.44
|
0.52
|
1.85
|
Sources: wsj.com, bigcharts.com, treasury.gov - 9/21/182,6,7,8
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.
T H E W E E K L Y
R I D D L E
You
go into the forest and get it, you
sit down to find it, and then you go
home, just wanting to get it out.
What is it?
LAST
WEEK’S RIDDLE: It takes eight workers four hours to dig a 30’ hole in the
ground. How long would it take them to dig half a hole?
ANSWER:
No time at all, for you cannot dig half a hole.
Troy L
Thompson, CFP, may be reached at 515-432-5421 or troy@thompsonfinancialinc.com
www.thompsonfinancialinc.com
www.thompsonfinancialinc.com
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Troy Thompson, CFP
DBA: Thompson Financial, Inc.
and Hanson Asset Strategies
Securities offered through
FIRST HEARTLAND CAPITAL, INC.
Member FINRA & SIPC.
Thompson Financial is not affiliated with
FIRST HEARTLAND CAPITAL, INC.
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
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Indices do not incur management fees, costs and expenses, and cannot be
invested into directly. All economic and performance data is historical and not
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Additional risks are associated with international investing, such as currency
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CITATIONS:
1 - foxbusiness.com/markets/stock-futures-point-to-added-gains-after-record-day
[9/21/18]
2 - markets.wsj.com/us [9/21/18]
3 - reuters.com/article/us-usa-economy-housing/u-s-existing-home-sales-unchanged-in-august-idUSKCN1M026A
[9/20/18]
4 - investing.com/economic-calendar/
[9/21/18]
5 - marketwatch.com/story/us-oil-ends-week-at-2-month-high-books-second-straight-weekly-advance-2018-09-21
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F21%2F17&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F21%2F17&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F21%2F17&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F20%2F13&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F20%2F13&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F20%2F13&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F22%2F08&x=0&y=0
[9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F22%2F08&x=0&y=0 [9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F22%2F08&x=0&y=0 [9/21/18]
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [9/21/18]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F22%2F08&x=0&y=0 [9/21/18]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F22%2F08&x=0&y=0 [9/21/18]
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [9/21/18]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [9/21/18]