ISM: SERVICE SECTOR VERY HEALTHY
At 55.2, the Institute for Supply Management’s April non-manufacturing PMI climbed 2.1 points above the March reading. The nation’s service sector expanded for a 51st straight month, and the survey saw big monthly leaps in its new orders index (up 4.8 points to 58.2) and its business activity index (which rose 7.5 points to 60.9).1
THE S&P EARNINGS SCORECARD (SO FAR)
As last week ended on Wall Street, 451 members of the S&P 500 had announced results in the Q1 earnings season. According to Bloomberg’s tally, 76% of those firms exceeded profit projections and 53% beat revenue forecasts. Analysts surveyed by Bloomberg estimate that earnings for S&P constituents improved 5.5% in Q1 while sales rose 3.0%.2
GAS AT $3.66 A GALLON, OIL JUST UNDER $100
The Memorial Day weekend arrives May 24-26; will prices fall slightly by then? The national average for regular unleaded on May 9 was $0.11 higher than a year ago, according to AAA’s Daily Fuel Gauge Report. NYMEX crude rose 0.2% across five days to settle at $99.99 as the week ended; gold pulled back 1.2% last week, finishing at $1,287.60 on the COMEX Friday.3,4
A RECORD CLOSE FOR THE DOW
A small Friday advance left the index at 16,583.34 at Friday’s closing bell. While the blue chips rose 0.43% for the week, the S&P 500 retreated 0.14% and the Nasdaq declined 1.26%. The S&P settled at 1,878.48 Friday, the Nasdaq at 4,071.87.5
THIS WEEK: Monday, Wall Street will react to the weekend independence vote held by pro-Russian separatists in eastern Ukraine, who have vowed to form their own republic; no major news is scheduled stateside. April retail sales numbers are out Tuesday along with Q1 results from Hertz Global; additionally, investors will consider China’s April industrial output and retail sales. Wednesday marks the release of April’s PPI plus earnings from Cisco, Jack in the Box, Macy’s, Abercrombie & Fitch, RE/MAX, SodaStream and Valero. Thursday, Federal Reserve chair Janet Yellen speaks on small businesses and the economy in the nation’s capital; April’s CPI and industrial production report arrive, the latest initial claims figures are released and Wal-Mart, Kohl’s, Nordstrom and J.C. Penney announce quarterly results. Friday sees the release of the University of Michigan’s initial May consumer sentiment index and data on April building permits and housing starts.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +0.04 +9.95 +18.68 +6.60
NASDAQ -2.51 +19.44 +26.83 +11.48
S&P 500 +1.63 +15.48 +20.43 +7.28
REAL YIELD 5/9 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.44% -0.50% 1.77% 2.25%
Sources: USATODAY.com, bigcharts.com, treasury.gov – 5/9/146,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.
WEEKLY QUOTE
“Every great mistake has a halfway moment, a split second when it can be recalled and perhaps remedied.”
– Pearl S. Buck
WEEKLY TIP
Sometimes a radio commercial or cable TV ad will pitch a vaguely described investment that you “must know about” offering impressive returns with virtually no risk. These claims are red flags.
WEEKLY RIDDLE
James has two kids. If the eldest is a girl, what are the chances that the youngest is also a girl?
Last week’s 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 answer:
A comb.
Citations.
1 – ism.ws/ISMReport/NonMfgROB.cfm [5/5/14]
2 – bloomberg.com/news/2014-05-09/u-s-stock-futures-retreat-as-investors-assess-earnings.html [5/9/14]
3 – fuelgaugereport.aaa.com [5/9/14]
4 – proactiveinvestors.com/companies/news/54023/gold-loses-12-on-week-oil-settles-at-9999-54023.html [5/9/14]
5 – thestreet.com/story/12702814/1/market-hustle-stocks-lower-amid-deal-news-markets-eye-ukraine-vote.html [5/9/14]
6 – usatoday.com/money/markets/overview/ [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F9%2F13&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F9%2F13&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F9%2F13&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F8%2F09&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F8%2F09&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F8%2F09&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F10%2F04&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F10%2F04&x=0&y=0 [5/9/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F10%2F04&x=0&y=0 [5/9/14]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/9/14]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/9/14]
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 professional athletes and select individuals. Stonecreek is located in Salt Lake City, Murray, West Jordan, Sandy, Draper, South Jordan, Provo, Orem, Lehi, Highland, Alpine, American Fork all in Utah.
