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Economics

Weekly Economic Update

March 2, 2015                                                                                                      (content for this post provided by third party)
CPI SHOWS ANNUAL DEFLATION

Dipping 0.7% in January, the Labor Department’s Consumer Price Index posted a 0.1% annual retreat – its first yearly decline since 2009. As the core CPI rose 0.2% in January and gas prices are moving north, the headline CPI’s stint in deflation territory may be short-lived. The federal government also announced its second estimate of Q4 GDP last week – a passable 2.2% – and a 2.8% boost in hard goods orders for January.1,2

HOUSEHOLD CONFIDENCE DECLINES

The Conference Board’s monthly survey of consumers slipped 7.4 points in February to a reading of 96.4. At the end of January, the University of Michigan’s consumer sentiment index reached 98.1; the final February index came in lower at 95.4.2,3

 

PENDING HOME SALES, HOME PRICES RISE

The National Association of Realtors said housing contract activity increased 1.7% in January, and December’s S&P/Case-Shiller index showed a 4.5% overall annual increase in existing home prices. The Census Bureau noted an 0.2% dip in new home sales in January, however; the NAR found resales falling 4.9% in that month.2,4

 

FEBRUARY WAS FANTASTIC FOR STOCKS

Look at these monthly gains: S&P 500, 5.49%; Dow, 5.64%; Nasdaq, 7.08%. Last week, the S&P lost 0.27% and the Dow 0.04% while the Nasdaq rose 0.15%. Final numbers: DJIA, 18,132.70; Nasdaq, 4,963.53; S&P, 2,104.50. Oil fell 1.32% to $49.27 on the NYMEX, gold rose 1.21% to $1,213.60 on the COMEX.5,6

 

THIS WEEK: ISM’s January manufacturing index appears Monday, plus January’s consumer spending report and earnings from Progressive, NutriSystem and Molycorp. On Tuesday, the Street examines earnings from Best Buy, AutoZone, Smith & Wesson, Revlon, Bob Evans, TiVo and Dick’s Sporting Goods, and Federal Reserve chair Janet Yellen speaks on bank regulation in New York. Wednesday brings February’s ADP employment change report, a new Beige Book from the Federal Reserve, ISM’s February services index and earnings from Abercrombie & Fitch, American Eagle, Korn/Ferry, PetSmart, Jamba, Tribune Publishing, Scripps Co. and H&R Block. February’s Challenger job cuts report arrives Thursday along with the latest bank stress test results from the Fed, new initial claims numbers and a report on January factory orders; earnings roll in from Chesapeake Utilities, Marcus & Millichap, Costco, Martha Stewart Living, Fresh Market, Quiksilver and Kroger. The Labor Department’s February employment report comes out Friday, as well as earnings from Foot Locker, BigLots! and Staples.

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +1.74 +11.43 +15.12 +6.84
NASDAQ +4.80 +14.92 +24.35 +14.19
S&P 500 +2.21 +13.49 +18.11 +7.49
REAL YIELD 2/26 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.24% 0.49% 1.48% 1.70%

Sources: online.wsj.com, bigcharts.com, treasury.gov – 2/27/155,7,8,9,10

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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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 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/kfx2gv2 [2/20/15]

2 – bloomberg.com/news/articles/2015-02-18/factory-production-in-u-s-climbed-less-than-forecast-in-january [2/18/15]

3 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [2/20/15]

4 – markets.wsj.com/us [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F20%2F14&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F20%2F14&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F20%2F14&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F19%2F10&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F19%2F10&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F19%2F10&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F18%2F05&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F18%2F05&x=0&y=0 [2/20/15]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F18%2F05&x=0&y=0 [2/20/15]        

6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [2/20/15]

7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [2/20/15]

 

 

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