Economic Update July 20, 2015

Phillip Allenc Inc.

 

WEEKLY ECONOMIC UPDATE

 

 

WEEKLY QUOTE
              
“Have regard for your name, since it will remain for you longer than a great store of gold.”

– Ecclesiasticus

WEEKLY TIP
             
Savings should be the bedrock of any college financing strategy, not gifts, student loans or student income.

WEEKLY RIDDLE
            
Live without it and you will not prevail, but if you have too much of it, you will surely fail. What is it?

Last week’s riddle:
Jacquie and her daughter Amanda walk past a man in a café. Amanda says “Hello, father” – and a split-second later, so does Jacquie. How are they both able to make this remark to him without any confusion or embarrassment?  

Last week’s answer:
The man is a priest.

 

 

 

 

 

July 20, 2015

   

CONSUMER & WHOLESALE PRICES INCREASE
The Labor Department announced a 0.3% June rise in the headline Consumer Price Index, following the 0.4% advance for May. This left annualized consumer inflation positive for the first time in six months (+0.1%). June brought a 0.2% gain for the core CPI, which is now up 1.8% across the past year. Last month also saw the Producer Price Index ascend 0.4%; in May, it climbed 0.5%.1,2
    
HOUSEHOLD SENTIMENT, RETAIL SALES COOL
Retail sales fell 0.3% last month after a 1.0% rise in May, according to the Commerce Department. Analysts polled by MarketWatch felt sales would pick up 0.2% in June. The University of Michigan’s initial July consumer sentiment index slipped 2.8 points to a 93.3 reading.2
 
LAST MONTH SAW A JUMP IN CONSTRUCTION
Census Bureau data showed housing starts up 9.8% in June. Building permits rose 7.4% to an 8-year peak; permits for single-family homes hit a 7½-year high.3
 
GREEK DEBT DEAL, EARNINGS TAKE STOCKS NORTH
Upside surprises and the approval of a third Greek bailout by European leaders led to impressive weekly gains for the major indices. The S&P 500 rose 2.41% to 2,126.64, the Dow 1.84% to 18,086.45 and the Nasdaq 4.25% to 5,210.14.4
        
THIS WEEK: Monday’s earnings reports: Halliburton, Hasbro, HealthStream, Morgan Stanley and Unisys. Tuesday’s earnings: Apple, Microsoft, Hanesbrands, BoNY Mellon, Chipotle, Yahoo!, GoPro, Harley-Davidson, Kaiser Aluminum, Lexmark, Lockheed Martin, Fifth Third, Manpower, Skechers, and Travelers Companies. Wednesday offers June existing home sales and earnings from Abbott Labs, Altera, American Express, Ameriprise Financial, AutoNation, Boeing, SanDisk, Cheesecake Factory, Coca-Cola, Discover, Dolby Labs, Equifax, Northern Trust, Owens Corning, Qualcomm, Royal Caribbean, Six Flags, Smart & Final, Texas Instruments, Whirlpool, Tupperware, and United Rentals. Thursday offers the Conference Board LEI, a new initial claims report and earnings from 3M, Ace Hardware, Alaska Airlines, Amazon, AT&T, BJ’s, Boise Cascade, Capital One, Caterpillar, Celgene, Chubb, Bristol-Myers Squibb, Comcast, CoreLogic, Dow Chemical, Dr. Pepper Snapple, Eli Lilly, E*TRADE, Dunkin’ Brands, GM, Invacare, Kimberly-Clark, Macerich, McDonald’s, Pandora, PulteGroup, Quest Diagnostics, Raytheon, Southwest Airlines, Starbucks, T. Rowe Price, TripAdvisor, Under Armour, Union Pacific, VISA, and Waste Management. Friday brings June new home sales plus earnings from American Airlines, Biogen, Spirit Airlines, and Xerox.

 

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +1.48 +6.54 +15.82 +7.10
NASDAQ +10.01 +19.40 +27.82 +14.29
S&P 500 +3.29 +8.61 +19.94 +7.42

REAL YIELD

4/3 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.51% 0.24% 1.25% 1.98%

 

Sources: online.wsj.com, bigcharts.com, treasury.gov – 12/26/145,6,7,8

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.

 

 

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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. 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 – bloomberg.com/news/articles/2015-07-17/consumer-prices-in-u-s-increase-in-june-paced-by-higher-rents [7/17/15]
2 – marketwatch.com/economy-politics/calendars/economic [7/17/15]
3 – fxstreet.com/news/forex-news/article.aspx?storyid=c7fac744-9b01-4e72-9558-09281f70d6e7 [7/17/15]
4 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [7/17/15]
5 – markets.wsj.com/us [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F17%2F14&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F17%2F14&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F17%2F14&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F16%2F10&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F16%2F10&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F16%2F10&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F18%2F05&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F18%2F05&x=0&y=0 [7/17/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F18%2F05&x=0&y=0 [7/17/15]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [7/17/15]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [7/17/15]

 

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