JULY 2018

In this month’s recap: tariff talk weighs on equities worldwide, oil prices jump 10%, and the Fed raises rates once more. Monthly Economic Update   Presented by Andy Tomlinson, July 2018   THE MONTH IN BRIEF While segments of the stock market rallied in June, assumptions that a global trade war was starting hurt the […]

JUNE 2018

THE MONTH IN BRIEF In May, investors were left to interpret mixed geopolitical and financial signals. The historic U.S.-North Korea summit was on, then off, then possibly on again. An apparent truce emerged in the U.S.-China tariffs battle, but it did not last. Oil rallied, but then prices fell. Federal Reserve policy meeting minutes indicated […]

MAY 2018

THE MONTH IN BRIEF April saw the S&P 500 advance 0.27% as a new earnings season unfolded – one in which investors grew uneasy about rising Treasury yields, protectionism, and privacy concerns involving tech giants. While the financial media largely focused on those anxieties, good news also appeared. The latest consumer spending and consumer confidence […]

FEBRUARY 2018

THE MONTH IN BRIEF Bulls took charge of Wall Street as 2018 began: the Dow Jones Industrial Average rose 5.79% in the first month of the year, even with a mild selloff on the verge of February. Foreign equity benchmarks largely advanced as well. Oil and gasoline futures surged, while bitcoin continued to rollercoaster. Personal […]

JANUARY 2018

January 2018 THE MONTH IN BRIEF Financially speaking, the last month of 2017 was also the year’s most newsworthy. Congress reformed federal tax law to a degree unseen since the 1980s, the Federal Reserve raised the benchmark interest rate, and bitcoin took its investors for a wild ride. Hiring, retail sales, and personal spending numbers […]

DECEMBER 2017

THE MONTH IN BRIEF In November, the S&P 500 gained 2.81% and advanced for a thirteenth straight month – an unprecedented milestone in the index’s long history. Consumer confidence and investor confidence were both abundant, as further evidence arrived that the economy was growing at an impressive rate. Solid fundamental indicators, upbeat earnings announcements, and […]

NOVEMBER 2017

THE MONTH IN BRIEF October saw the S&P 500 rise 2.22% in response to results from the fall earnings season, encouraging fundamental indicators, and anticipation of tax reforms. An impressive jump in personal spending complemented excellent readings on consumer confidence and purchasing manager indices; although, hiring suffered a setback. As the European Union contended with […]

OCTOBER 2017

THE MONTH IN BRIEF In August, investors witnessed a terrible natural disaster and heard threats of war on America, and the S&P 500 still managed to gain 0.05%. September brought two terrible natural disasters and more threats of war on America, and the broad benchmark rose 1.93% and topped 2,500 for the first time. In […]

AUGUST 2017

THE MONTH IN BRIEF The Dow Jones Industrial Average gained 2.54% in July as earnings announcements and fundamental indicators provided a lift for the blue chips and other stock market indices. Hiring and manufacturing data was particularly reassuring. Annualized inflation declined once more. Oil, gold, and other marquee commodities advanced and so did many Asia-Pacific […]

JULY 2017

THE MONTH IN BRIEF June brought some definite headwinds to Wall Street, but the broad stock market still advanced. The S&P 500 added 0.48% across the month, even with tech shares selling off. As anticipated, the Federal Reserve raised the federal funds rate by another quarter point. Last month was a trying one for European […]

JULY 10, 2017

HIRING PICKS UP AGAIN The Department of Labor announced some good news Friday: the creation of 222,000 net new jobs in June, the largest hiring gain in four months. Approximately 4.7 million people reentered the labor force and found work in June, a peak unmatched in 27 years of monthly data. Wages rose 0.2% for […]

JULY 3, 2017

HOUSEHOLD EARNINGS OUTPACE SPENDING According to newly released Department of Commerce data, personal incomes improved 0.4% in May, but personal spending advanced just 0.1% after a 0.4% gain in April. Core consumer prices (minus food and energy costs) rose only 1.4% during the 12 months ending in May.1,2,3   WERE CONSUMERS MORE CONFIDENT IN JUNE? […]

JUNE 26, 2017

MORE HOMES MOVED IN MAY In a pleasant surprise for economists, both new and existing home sales picked up last month. The National Association of Realtors announced a 1.1% gain for resales, with the average house for sale spending only 27 days on the market. New home buying increased 2.9% in May, resulting in an […]

JUNE 19, 2017

FED DELIVERS EXPECTED & UNEXPECTED NEWS As Wall Street anticipated, the Federal Reserve raised interest rates on June 14. The Federal Open Market Committee voted 8-1 to take the benchmark interest rate north by a quarter-point to the 1.00-1.25% range. The Fed also said it would begin to reduce its $4.5 trillion balance sheet at […]

JUNE 12, 2017

AN UPBEAT REPORT ON THE SERVICE SECTOR The Institute for Supply Management’s May non-manufacturing purchasing manager index displayed a reading of 56.9 last week, showing expansion in U.S. service industries for an eighty-ninth straight month. Although the gauge declined 0.6 points from its April mark, it signaled a solid pace of growth. The index’s employment […]

JUNE 2017

THE MONTH IN BRIEF May was another good month for stocks. The S&P 500 gained more than 1%, putting its YTD advance above 7.7%. While the housing market showed some spring weakness, hiring bounced back and most other important economic indicators did not falter. Wall Street seemed little troubled by politics, terrorist incidents, data disappointments, […]

JUNE 5, 2017

JOB CREATION, JOBLESS RATE DOWN IN MAY A day after ADP’s employment change report estimated a hiring gain of 253,000 in May, the Department of Labor’s latest jobs report told a far different story. It said employers added just 138,000 workers last month. The U-3 jobless rate fell to a 16-year low of 4.3% in […]

MAY 29, 2017

CONSUMER SENTIMENT DECLINES JUST A BIT Ending May at a mark of 97.1, the University of Michigan’s consumer sentiment index fell 0.6 points from its preliminary reading for the month. Economists polled by MarketWatch had forecast the gauge to remain at 97.7.1 FEWER HOMES WERE BOUGHT IN APRIL Both new and existing home sales tapered […]

MAY 22, 2017

CONSTRUCTION ACTIVITY SLOWED IN APRIL Against expectations, both housing starts and building permits declined in the fourth month of the year. Newly released Census Bureau data shows a 2.5% retreat for permits and a 2.6% pullback for starts last month. The key factors: a 9.2% drop in starts for multi-family projects (which have declined for […]

MAY 15, 2017

A SOLID RETAIL SALES READING Americans bought more in April. The pace of retail purchases hastened by 0.4% last month, and the Bureau of Economic Analysis revised the 0.2% March retreat into a 0.1% gain. Headline retail sales were up 4.5% across the 12 months ending in April. Core retail sales rose 0.3% in the […]

MAY 8, 2017

NEW DATA SHOWS MORE HIRING, LESS SPENDING Unemployment hit a 10-year low in April as payrolls swelled with 211,000 net new jobs, a rebound from the meager gains of March. The Department of Labor’s monthly report showed the headline jobless rate declining 0.1% to 4.4%; the U-6 rate measuring underemployment was at 8.6%, falling 0.3%. […]

MAY 8, 2017

THE MONTH IN BRIEF In April, investors kept one eye on impressive corporate earnings and another on geopolitical developments in Asia and Europe. Earnings ultimately drew the most attention – the Dow Jones Industrial Average rose more than 1% for the month, while the Nasdaq Composite added more than 2%. The latest readings on some […]

MAY 1, 2017

CONSUMER CONFIDENCE DIPS SLIGHTLY The University of Michigan and Conference Board consumer confidence indices descended a little last month, but remained in great shape. The CB index displayed an April reading of 120.6, down from 124.9 in March. Slipping a point from its initial April mark, the Michigan barometer fell to 97.0.1   LATEST HOUSING […]

April 24, 2017

EXISTING HOME SALES HIT A 10-YEAR PEAK Rising 4.4% for March, resales surpassed expectations – analysts polled by Reuters projected a gain of 2.5%. The National Association of Realtors said that sales were 5.9% improved from a year before, and that put them at their best level since February 2007, even with existing home inventory […]

APRIL 17, 2017

PRICES DECLINE IN MARCH In March, the Consumer Price Index retreated for the first time in 13 months. Its 0.3% dip left annualized consumer inflation at a moderate 2.4%. Fuels, autos, and groceries have all become less expensive recently, according to Bureau of Labor Statistics data. Core consumer prices were up 2.0% in the year […]

APRIL 10, 2017

COMPANIES ADDED FEWER WORKERS IN MARCH Just 98,000 net new jobs were created last month, and some analysts think Winter Storm Stella may have held hiring back. Even so, the Department of Labor’s latest employment report showed the U-3 jobless rate decreasing 0.2% to 4.5%; the broader U-6 rate fell 0.3% to 8.9%. The big […]

April 2017

THE MONTH IN BRIEF Stocks went sideways rather than north in March, with the S&P 500 losing just 0.04%. The Federal Reserve made another quarter-point interest rate move, and overseas, the United Kingdom initiated Brexit proceedings. While new data showed weak consumer spending, consumer optimism remained high and hiring was once again strong. A subpar […]

APRIL 3, 2017

PERSONAL SPENDING SLOWS Consumers apparently chose saving over spending in the second month of the year. Last week, a Department of Commerce report noted only a 0.1% gain for personal spending in February. That happened even with personal incomes rising 0.4%, nearly matching the 0.5% January advance. In other news concerning personal spending, the Bureau […]

MARCH 27, 2017

NEW HOME SALES GO ONE WAY, RESALES ANOTHER Rising 6.1% in February, new home sales reached a 7-month peak. The Census Bureau said that this gain occurred with just 5.4 months of inventory on the market, less than half that available in 2006 during the height of the last residential real estate boom. In contrast, […]

MARCH 20, 2017

FED HIKES, LEAVES 2017 FORECAST UNCHANGED As expected, the Federal Reserve raised the target range for the federal funds rate by a quarter-point last week to 0.75-1.00%. “The simple message is, the economy is doing well,” Fed chair Janet Yellen explained to the media following the move. The central bank’s dot-plot table still projects two […]

MARCH 13, 2017

COMPANIES HIRED READILY IN FEBRUARY U.S. firms added 235,000 net new jobs last month, and the latest Department of Labor employment report showed the largest growth occurring in the construction and education/health care sectors. The DoL also revised January’s job gains upward by 11,000 to 238,000. Payroll expansion has averaged 209,000 per month since December. […]

MARCH 6, 2017

YELLEn: RATE MOVE MAY HAPPEN THIS MONTH In Chicago Friday, Federal Reserve chair Janet Yellen said that if hiring and inflation indicators continue to meet the central bank’s expectations, an interest rate hike “would likely be appropriate” at its March policy meeting. She also noted that, barring unforeseen events, the pace of tightening in the […]

MARCH 2017

THE MONTH IN BRIEF February was a great month for stocks and a historic month for the Dow Jones Industrial Average. The blue chips closed at record highs for 12 straight trading sessions, a feat unmatched for 30 years. The S&P 500 gained 3.72% for the month. Readings on consumer confidence and purchasing manager indices […]

FEBRUARY 27, 2017

A LITTLE LESS OPTIMISM AMONG CONSUMERS February’s final University of Michigan consumer sentiment index came in at 96.3, down from its January mark of 98.5, but well above the 91.7 reading of a year earlier. Despite the descent, the index just had its best three months since early 2004.1 FED MINUTES SUGGEST RATE MOVE MAY […]

FEBRUARY 20, 2017

RETAIL SALES ROSE 0.4% in JANUARY Consumer spending on household electronics and appliances powered this gain. Analysts polled by Reuters had expected a 0.1% advance. Core retail purchases also rose 0.4% last month. The Department of Commerce revised the December increase for retail sales upward to 1.0%. Across the 12 months ending in January, retail […]

FEBRUARY 13, 2017

CONSUMER SENTIMENT SLIPS A BIT The University of Michigan’s preliminary February index of consumer sentiment came in at a reading of 95.7 Friday, compared with a final January mark of 98.5 (which was a 13-year peak). Economists polled by Bloomberg had expected a slight decline to 98.0. While this was the index’s lowest level in […]

FEBRUARY 2017

THE MONTH IN BRIEF Stocks advanced again in January. The Dow Jones Industrial Average closed above 20,000 for the first time, and the S&P 500 gained 1.79% on the month. As January ended, politics took center stage: investors focused first on the controversy surrounding President Donald Trump’s executive orders, then on earnings and economic indicators. […]

FEBRUARY 6, 2017

POSITIVES & NEGATIVES IN JANUARY’s JOB DATA The Department of Labor’s latest jobs report showed 227,000 net new hires last month. Unfortunately, wages grew just 0.1% in January as the headline jobless rate rose slightly to 4.8%. The U-6 rate, counting the underemployed, rose 0.2% to 9.4%.1 STRONG CONSUMER CONFIDENCE & SPENDING While the Conference […]

JANUARY 30, 2017

HOUSEHOLD SENTIMENT GAUGE RISES AGAIN The University of Michigan’s Index of Consumer Sentiment gained 0.4 points from its preliminary reading this month to reach a final January mark of 98.5. That represents a 12-year peak for the index, which stood at 92.0 in January 2016.1,2 HOME SALES FELL IN DECEMBER Given costlier mortgages, rising prices, […]

JANUARY 23, 2017

LARGEST INFLATION ADVANCE IN 5 YEARS The Consumer Price Index rose 2.1% in 2016, marking its greatest annual gain since 2011. During 2015, consumer prices only increased by 0.7%. December saw a 0.3% rise for the headline CPI and a 0.2% gain for the core CPI (which excludes food and energy costs). The core CPI […]