Weekly Economic Update - 1/16/2018Submitted by Rock House Financial on January 16th, 2018
RETAIL SALES ROSE IN DECEMBER
Consumers spent freely during the holidays: the latest Census Bureau report shows a nice advance for retail purchases. They improved 0.4% last month, with core retail sales up by the same amount.1
PRODUCER PRICES UNEXPECTEDLY RETREAT
In December, wholesale inflation declined for the first time in 18 months. Even with that 0.1% dip, the Producer Price Index advanced 2.6% for 2017, compared with 1.7% in 2016. Households contended with 2.1% inflation during 2017 according to the Consumer Price Index, which ticked up 0.1% last month. Core consumer prices rose 0.3% in December, so the 2017 core CPI gain was 1.8%.1,2
OIL CLIMBS AGAIN
Last week, prices benefited from reduced reserves and extensions of U.S. sanctions relief against Iran. West Texas Intermediate crude settled at $64.30 Friday on the NYMEX, advancing 4.7% across five trading days. That was its highest price since December 2014.3
ANOTHER SOLID WEEK FOR EQUITIES
Bulls still far outnumber bears on Wall Street, as last week’s major index performances show. For the week, the Dow Jones Industrial Average rose 2.01% to 25,803.19; the Nasdaq Composite, 1.74% to 7,261.06; the S&P 500, 1.57% to 2,786.24. The last five market days also brought a 2.05% gain for the Russell 2000. The PHLX Oil Service index ended the week up 23.24% month-over-month.4
THIS WEEK: U.S. financial markets are mostly closed on Martin Luther King Jr. Day (futures do trade on Monday morning). Citigroup, Comerica, CSX, and UnitedHealth Group release earnings on Tuesday. Wednesday’s earnings announcements include news from Alcoa, Bank of America, Fastenal, Goldman Sachs, and U.S. Bancorp; in addition, the Federal Reserve offers a new Beige Book. On Thursday, American Express, BoNY Mellon, BB&T, J.B. Hunt, IBM, KeyCorp, and Morgan Stanley announce earnings; investors will consider new initial claims data and a report on December construction activity as well. Friday, Regions Financial, Schlumberger, and SunTrust Bank report earnings, and the preliminary January consumer sentiment index from the University of Michigan appears.
|% Change||Y-T-D||1 Yr Chg||5 Yr Avg||10 Yr Avg|
|Real Yield||1/12 Rate||1 Yr Ago||5 Yrs Ago||10 Yrs Ago|
|10 YR TIPS||0.54%||0.38%||-0.63%||1.56%|
Sources: wsj.com, bigcharts.com, treasury.gov - 1/12/184,5,6,7
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.
“Always do right. This will gratify some people and astonish the rest.”
- Mark Twain
If your business is growing, make sure that its outstanding invoices do not grow in proportion to its expansion. Keep rein over your accounts receivable.
You will never see it. It brings you down, but never up. What is it?
Last week’s riddle:
The more of them you add, the less something will weigh. What are they?
Last week’s answer:
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This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of United Planners Financial Services. Neither United Planners nor its financial professionals render legal or tax advice. Please seek such advice from your own tax and legal counsel. 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.
1 - investing.com/economic-calendar/ [1/12/18]
2 - thestreet.com/story/14446654/1/producer-price-index-falls-for-first-time-since-2016.html [1/11/18]
3 - marketwatch.com/story/oil-prices-slip-from-3-year-high-as-traders-wait-for-trump-move-on-iran-2018-01-12 [1/12/18]
4 - markets.wsj.com/us [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F12%2F17&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F12%2F17&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F12%2F17&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F11%2F13&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F11%2F13&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F11%2F13&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F11%2F08&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F11%2F08&x=0&y=0 [1/12/18]
5 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F11%2F08&x=0&y=0 [1/12/18]
6 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [1/12/18]
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [1/12/18]