Weekly Economic Update
MidAmerica Financial Resources Presents:
“Only passions, great passions, can elevate the soul to great things.”
- Denis Diderot
Investing assets in largely unrelated sectors or industries is integral to portfolio diversification.
A father tells his young son, “I will pay you $6.00 per hour for the 6 seconds you took to wash your hands before dinner.” So how much does the boy earn for these 6 seconds of effort?
Last week’s riddle:
It flies, but has no wings. It slips away, but cannot be held in the hand. What is it?
Last week’s answer:
July 28, 2014
YEARLY INFLATION AT 2.1%
In June, the headline Consumer Price Index recorded annualized inflation at that level for a second consecutive month. Back in February, yearly consumer inflation was down at 1.1%. June saw the CPI rise 0.3% and the core CPI (minus food and energy prices) advance 0.1%; core CPI was up 1.9% year-over-year.1
CONTRASTING HOME SALES NUMBERS IN JUNE
The Census Bureau announced an 8.1% June drop in new home buying, which left 5.8 months of inventory in the market (the most since October 2011). New home prices were up 5.3% year-over-year. Existing home sales picked up 2.6% in June; that was the second straight monthly gain, pushing the seasonally adjusted annual sales rate above the 5 million mark for the first time since October.2
MORE DEMAND FOR DURABLES
Hard goods orders improved 0.7% in June; analysts polled by Bloomberg projected a 0.5% advance. The Commerce Department also announced a 3.5% yearly gain.3
MIXED WEEK FOR MAJOR U.S. INDICES
Across five days filled with earnings news and geopolitical concerns, the Dow fell 0.83% to 16,960.57, the Nasdaq gained 0.40% to 4,449.56, and the S&P 500 went flat for the week, retreating just 0.03 points and settling Friday at 1,978.34.4,5
THIS WEEK: Monday, NAR announces June pending home sales and earnings roll in from Berkshire Hathaway, Hertz Global, Tyson Foods, Trulia, Whole Foods, Coach, HealthSouth, XL, Herbalife and Norwegian Cruise Lines. Tuesday brings the May Case-Shiller home price index, July’s Conference Board consumer confidence survey and earnings from Twitter, Aflac, Merck, Aetna, UPS, Big 5, Martin Marietta, McGraw Hill, Spirit Airlines, Panera, Genworth, Ameriprise Financial, American Express, Marriott, Anadarko, Amgen, Ruby Tuesday, Sirius XM, Pfizer and Newmont Mining. Wednesday offers earnings from Allstate, Cardtronics, Garmin, Humana, Hartford, Tesoro, WellPoint, Valero, Yelp!, SodaStream, Akamai, Revlon, Noble Corp., Kraft Foods and MetLife, along with a Fed policy statement, July’s ADP job change report and a first estimate of Q2 GDP from Washington. Thursday, July’s Challenger job cuts report and new initial claims figures arrive plus earnings from ADP, Tesla, T-Mobile, Hyatt, Public Storage, ExxonMobil, Fluor, Edison, PG&E, Marathon Petroleum, Occidental, Avon, Time Warner Cable, Coinstar, Mosaic, MasterCard, Live Nation, Kellogg, Western Union, Cigna, ConocoPhillips, Charter Communications and DirecTV. Friday, we get the July jobs report, the June personal spending report and earnings from Burger King, Hilton, Cummins and Clorox.
Sources: USATODAY.com, bigcharts.com, treasury.gov - 7/25/145,6,7,8
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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.
1 - investing.com/economic-calendar/ [7/25/14]
2 - cbsnews.com/news/new-home-sales-plunge-8-1-percent/ [7/24/14]
3 - usatoday.com/story/money/business/2014/07/25/durable-goods/13148389/ [7/25/14]
4 - google.com/finance?q=INDEXSP%3A.INX&ei=iMzSU8i-Der8igLgzYGgAg [7/25/14]
5 - usatoday.com/money/markets/overview/ [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F25%2F13&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F25%2F13&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F25%2F13&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F24%2F09&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%24F2%2F09&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F24%2F09&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F26%2F04&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F26%2F04&x=0&y=0 [7/25/14]
6 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F26%2F04&x=0&y=0 [7/25/14]
7 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [7/25/14]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [7/25/14]
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Weekly Economic Update