WEEKLY ECONOMIC UPDATE WEEKLY QUOTE “To conquer fear is the beginning of wisdom.” - Bertrand Russell WEEKLY TIP Be careful not to take on more risk in your portfolio than you are comfortable with. If you do, you may succumb to panic selling should a downturn happen. WEEKLY RIDDLE It has dozens of fine teeth, but you can hold it in your hand and it will never bite you. What is it? Last week’s riddle: What 10-letter word (in English) can you type out using only the topmost row of letters on a computer keyboard (the Q-P row)? Hint: the first two letters of the word are next to each other in the Q-P row. Last week’s answer: Typewriter. May 5, 2014 HIRING & MANUFACTURING PICK UP America’s economy created 288,000 new jobs in April, the most in any month since January 2012. Labor Department data showed the jobless rate falling dramatically to 6.3%, largely due to more people abandoning the job hunt. Still, the U-6 rate (unemployment + underemployment) was at 12.3% in April, a 4½-year low. The Institute for Supply Management factory PMI rose to 54.9 in April, marking the eleventh straight month of expansion in manufacturing.1,2 ROBUST CONSUMER SPENDING, YET WEAK Q1 GDP Personal spending rose 0.9% in March, nearly double the 0.5% advance that the Commerce Department saw in February. Even so, the Bureau Of Economic Analysis said the economy grew by just 0.1% in the first quarter in its initial estimate.3 CONSUMER CONFIDENCE DOWN SLIGHTLY The Conference Board’s respected index was at 82.3 in April, down from 83.9 in March. Analysts polled by the Wall Street Journal had forecast a dip to 83.0.4 PENDING HOME SALES INCREASE AT LAST They rose 3.4% in March, the National Association of Realtors said; the last monthly upturn was in June. In other housing news, February’s S&P/Case-Shiller Home Price Index showed a 12.9% overall yearly advance.3 ANXIETIES BUILD, BUT STOCKS DON’T TURN SOUTH At Friday’s close, the Dow settled at 16,512.89, the S&P 500 at 1,881.14 and the Nasdaq at 4,123.90. Across five days, the DJIA gained 0.93%, the S&P 0.95% and the Nasdaq 1.19% even with the Ukraine crisis intensifying late in the week.5 THIS WEEK: On Monday, Occidental Petroleum, AIG, Acura, Pfizer, Papa John’s, Tyson Foods, Andarko Petroleum, Cardtronics and Orbitz report earnings and ISM offers its April service sector PMI. Quarterly results from Activision Blizzard, Alamo, Allstate, Groupon, Marathon Oil, Office Depot, Zulily, Coca-Cola, DirecTV, Whole Foods, Eastman Kodak, Electronic Arts, Towers Watson, TripAdvisor, Starwood Properties and Chesapeake Utilities arrive on Tuesday. Wednesday brings earnings from Allergan, Health Net, Tesla, Zillow, Hertz, Molycorp, Rosetta Stone, Humana, Prudential, Molson Coors, Keurig Green Mountain and Spectra Energy. A new initial jobless claims report and earnings from DISH Network, Wendy’s, Jamba, Dean Foods, Learning Tree, Scripps Networks, Toyota, Windstream, Nvidia, NewsCorp, Priceline, Symantec, Aramark, CBS and Monster appear Thursday. Friday brings data on March wholesale inventories and earnings from Hilton and Ralph Lauren. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA -0.38 +11.34 +20.21 +6.01 NASDAQ -1.26 +23.45 +27.97 +11.27 S&P 500 +1.77 +17.75 +22.87 +6.83 REAL YIELD 5/2 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS 0.41% -0.62% 1.80% 2.09% Sources: USATODAY, bigcharts, treasury.gov - 5/2/146,7,8,9 Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.
Posted on: Mon, 05 May 2014 16:45:00 +0000
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