FREEZING TEMPERATURES COOL RETAIL SALES
While the fourth quarter saw the strongest consumer spending in 3 years, the pace of retail purchases slowed last month. The Commerce Department reported a 0.4% drop in retail sales in January, and it revised December’s gain of 0.2% to a loss of 0.1%. Severe cold, reduced hiring and the end of long-term unemployment benefits were likely influences. There was one bit of reassurance in the Commerce Department’s report: minus auto buying, retail sales were actually flat last month.1
CONSUMER SENTIMENT IS UNCHANGED
The University of Michigan’s preliminary consumer sentiment index for February came in at 81.2, precisely where it had finished January. Analysts polled by Briefing.com had expected it to decline a full point.2
GOLD FUTURES HIT A 3-MONTH HIGH
Bearish sentiment (and dissatisfying economic indicators) encouraged a rally in precious metals last week. Gold gained 4.4% on the COMEX in five days to settle at $1,318.60 Friday – a level unseen since Halloween. Silver futures climbed 7.5% on the week to $21.42, the best price since early November. Copper futures gained 0.6% last week, platinum futures 3.7% and palladium futures 4.1%.3
WALL STREET PULLS OUT OF ITS SLUMP
Stocks really turned around last week, as these five-day index performances attest: DJIA, +2.45% to 16,154.39; NASDAQ, +2.83% to 4,244.02; S&P 500, +2.46% to 1,838.63.4
THIS WEEK: Monday is Presidents’ Day, so the NYSE and NASDAQ are closed as well as the U.S. bond market; Revlon and OfficeMax will announce Q4 results. Tuesday, earnings roll in from Blackrock, Medtronic, Panera, Coca-Cola, Del Monte, Waste Management and Herbalife, and the February NAHB housing market index arrives. On Wednesday, the minutes of the January Fed policy meeting will be released, along with the January PPI and data on January housing starts and building permits; HealthSouth, MGM, Safeway, Tesla Motors, Spirit Airlines, Marriott, Denny’s and Jack in the Box all issue earnings reports. Thursday brings the Conference Board’s January leading indicators index, the January CPI and earnings from BBVA, DirecTV, Hormel, Newmont Mining, Leap Wireless, Wal-Mart, Priceline, Hewlett-Packard, Intuit and Groupon. Existing home sales numbers for January are released Friday, along with earnings from Charter Communications and DISH Network.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -2.55 +15.61 +21.16 +5.20
NASDAQ +1.61 +32.68 +35.32 +10.67
S&P 500 -0.53 +20.85 +24.47 +6.05
REAL YIELD 2/14 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.59% -0.56% 1.68% 1.74%
Sources: USATODAY.com, bigcharts.com, treasury.gov – 2/14/145,6,7,8
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.
WEEKLY QUOTE
“Never allow a person to tell you no who doesn’t have the power to say yes.”
– Eleanor Roosevelt
WEEKLY TIP
Think about putting one-third or one-half of the pay raises you get in future years into your workplace retirement plan.
WEEKLY RIDDLE
Each morning, I show up at your feet, yet at midday I nearly retreat. No matter how fast you move, I follow. What am I?
Last week’s riddle:
It sits when it stands. It walks in jumps. It can grow up to 8′ tall. What is it?
Last week’s answer:
A kangaroo.
Citations.
1 – bloomberg.com/news/2014-02-13/retail-sales-in-u-s-decreased-0-4-in-january-commerce-says.html [2/13/14]
2 – briefing.com/investor/calendars/economic/ [2/14/14]
3 – marketwatch.com/column/metals%20stocks [2/14/14]
4 – google.com/finance?q=INDEXDJX%3A.DJI%2CINDEXSP%3A.INX%2CINDEXNASDAQ%3A.IXIC&ei=h4n-UsD_FIe1iwLUMA [2/14/14]
5 – usatoday.com/money/markets/overview/ [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F14%2F12&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F14%2F12&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F14%2F13&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F13%2F09&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F13%2F09&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F13%2F09&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F13%2F04&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F13%2F04&x=0&y=0 [2/14/14]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F13%2F04&x=0&y=0 [2/14/14]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [2/14/14]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [2/14/14]
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 Mark Lund, The 401k Advisor, Investor Coach and author of The Effective Investor. Mark offers investment advisory services through Stonecreek Wealth Advisors, Inc. an independent, fee-only, Registered Investment Advisor firm providing 401k consulting for small businesses and private investment management services for select individuals. Stonecreek is located in Salt Lake City and Provo Utah.
