CONSUMER PRICES ROSE 0.3% IN MARCH
Last month’s gain in the federal government’s Consumer Price Index matched the consensus forecast of economists polled by Briefing.com and followed gains of 0.4% in February and 0.2% in January. Gasoline prices were up 1.7% last month. Core CPI rose 0.2%, so that put annualized consumer inflation at 2.7%, less than the 2.9% recorded in February. Headline producer prices were flat in March, while the core Producer Price Index rose 0.3% (the fifth straight monthly rise in core PPI). Economists polled by Reuters had expected overall PPI to rise 0.2% last month.1,2,3
CONSUMER SENTIMENT WAVERS
April’s initial Reuters/University of Michigan consumer sentiment survey came in at 75.7, slightly below the Briefing.com consensus projection of 76.1 and down from the final March number of 76.2. Frustration over gas prices may have had an effect.2
BEIGE BOOK: RECOVERY PROCEEDING NICELY
The Federal Reserve’s latest snapshot of a dozen U.S. economic regions reported “modest to moderate” economic growth overall, with all 12 Fed districts anecdotally noting expansion. For the record, the Fed has described the recovery using the “modest to moderate” phrase in three consecutive Beige Books.4
BULLS BATTLE BEARS
April 9-13 was a volatile stretch for the market. For the week, the DJIA went -1.61% to 12,849.59, the S&P 500 -1.99% to 1,370.26 and the NASDAQ -2.25% to 3,011.33. All S&P 500 sectors lost ground on the week as concerns about Spain’s debt and U.S. corporate earnings affected investor outlooks.6,7
THIS WEEK: Monday, Census Bureau data on March retail sales complements earnings from Mattel, Charles Schwab, Gannett and Citigroup. Tuesday, reports on March housing starts and factory output come in along with Q1 results from Yahoo!, Coca-Cola, IBM, Goldman Sachs, Johnson & Johnson and Intel. Wednesday offers earnings from Yum Brands, Bank of NY Mellon, eBay and Qualcomm. Thursday, Q1 results from Bank of America, DuPont, Morgan Stanley, Travelers, Verizon, Microsoft, Capital One and SanDisk come in plus March existing home sales data. Friday brings earnings from General Electric and McDonalds.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +5.17 +4.72 +0.47 +2.61
NASDAQ +15.59 +9.05 +4.28 +7.15
S&P 500 +8.96 +4.25 -1.07 +2.33
REAL YIELD 4/13 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS -0.25% 0.88% 2.31% 3.48%
Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 4/13/127,8,9,10 Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.
WEEKLY QUOTE
“Physical fitness is not only one of the most important keys to a healthy body. It is the basis of dynamic and creative intellectual activity.”
– John F. Kennedy
WEEKLY TIP
Do you feel too financially pinched to contribute to an IRA? You could use your tax refund for that very purpose.
WEEKLY RIDDLE
What is the beginning of sorrow and the end of sickness? Something you cannot express happiness without? Something that is always in risk, but never in danger?
Last week’s riddle:
Karen is twice her brother’s age and half her father’s age. In 22 years, her brother will be half the father’s age. How old is Karen now?
Last week’s answer:
Karen is 22 years old.
Citations.
1 – www.nytimes.com/2012/04/14/business/economy/consumer-inflation-up-modestly.html [4/13/12]
2 – briefing.com/investor/calendars/economic/2012/04/09-13 [4/13/12]
3 – www.cnbc.com/id/47027476 [4/12/12]
4 – www.marketwatch.com/story/modest-to-moderate-economic-growth-beige-book-2012-04-11-148140 [4/11/12]
5 – money.msn.com/market-news/post.aspx?post=fadc5c34-4c33-4af9-90e2-9c80bb50cbcb [4/13/12]
6 – montoyaregistry.com/Financial-Market.aspx?financial-market=common-financial-mistakes-and-how-to-avoid-them&category=29 [4/13/12]
7 – www.cnbc.com/id/47040305 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F13%2F11&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F13%2F11&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F13%2F11&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F12%2F07&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F12%2F07&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F12%2F07&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F12%2F02&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F12%2F02&x=0&y=0 [4/13/12]
8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F12%2F02&x=0&y=0 [4/13/12]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [4/13/12]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [4/13/12]
10 – treasurydirect.gov/instit/annceresult/press/preanre/2002/ofm10902.pdf [1/9/02]
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. 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. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. 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. This material was prepared by MarketingLibrary.Net Inc., for Stonecreek Wealth Advisors, Inc. an independent fee only Registered Investment Advisor firm. Salt Lake City, Provo, Utah. Mark Lund is the author of The Effective Investor.
