RETAIL SALES WERE FLAT IN APRIL
Analysts surveyed by MarketWatch had forecast only a 0.1% advance, so this news was no shock. Still, it was disappointing after the (revised) 1.1% gain noted by the Commerce Department for March. The year-over-year improvement in the pace of retail sales was just 0.9%; last August, it reached 5.0%. Core retail sales (minus car and truck buying and fuel purchases) only increased 0.1% last month.1,2
CONSUMER SENTIMENT DIPS
The decline in the preliminary May University of Michigan consumer sentiment index defied expectations. At 88.6, the index fell 7.3 points from its final April mark. A consensus forecast of analysts contacted by Reuters projected a 96.0 reading.3
PRODUCER PRICES & INDUSTRIAL OUTPUT RETREAT
The Producer Price Index is still showing the impact of cheaper energy costs – it fell 0.4% in April after rising 0.2% a month earlier. According to the Federal Reserve, industrial production declined 0.3% in April, the same as in March.2
STOCKS & OIL CLIMB
Light sweet crude settled at $59.69 on the NYMEX Friday, advancing for a ninth straight week – its longest weekly winning streak since 1983. As a Thursday rally offset losses from previous trading days, the Dow advanced 0.45% for the week to 18,272.56. The Nasdaq Composite rose 0.89% last week to 5,048.29, the S&P 500 0.31% to 2,122.73.4,5
THIS WEEK: Urban Outfitters and Take-Two Interactive issue quarterly results Monday. On Tuesday, earnings arrive from Walmart, Dick’s Sporting Goods, TJX, Home Depot, Red Robin, and Etsy along with data on April housing starts and groundbreaking. Minutes from April’s Federal Reserve policy meeting appear Wednesday, plus earnings from American Eagle Outfitters, Hormel, L Brands, Target, Lowe’s, NetApp, Salesforce.com, Staples and Williams-Sonoma. Thursday, Wall Street reviews April existing home sales, new initial claims numbers, April leading indicators from the Conference Board and earnings from Aeropostale, Advance Auto Parts, America’s Car-Mart, Best Buy, Booz Allen Hamilton, Intuit, Dollar Tree, The Fresh Market, Gap, Hewlett-Packard, Lions Gate Entertainment, Ross Stores, Toro and Stein Mart. Friday, Fed chair Janet Yellen speaks in Rhode Island on the outlook for the U.S. economy; in addition, April’s CPI appears plus earnings from Foot Locker, Ann, Deere & Co. and Campbell Soup.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +2.52 +11.10 +14.41 +7.82
NASDAQ +6.59 +24.06 +23.02 +15.31
S&P 500 +3.10 +13.46 +17.38 +8.21
REAL YIELD 5/15 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.31% 0.31% 1.26% 1.66%
Sources: wsj.com, bigcharts.com, treasury.gov – 5/15/156,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.
WEEKLY QUOTE
“The truth is not simply what you think it is; it is also the circumstances in which it is said, and to whom, why and how it is said.”
– Vaclav Havel
WEEKLY TIP
Wondering what your cash flow might be like in retirement? Think about your potential income needs in your eighties and nineties as well as your sixties and seventies. Take sustained moderate inflation and the possibility of major medical expenses into account for the long term.
WEEKLY RIDDLE
No matter how little or how much you use me, you change your view of me every month. What am I?
Last week’s riddle:
I’m tall when I’m young and short when I’m old, usually indoors and sometimes on fire. What am I?
Last week’s answer:
A candle.
Citations.
1 – marketwatch.com/story/retail-sales-flat-in-april-as-gas-savings-continue-to-be-pocketed-2015-05-13 [5/13/15]
2 – marketwatch.com/economy-politics/calendars/economic [5/15/15]
3 – reuters.com/article/2015/05/15/us-usa-economy-sentiment-idUSKBN0O01IQ20150515 [5/15/15]
4 – marketwatch.com/story/oil-prices-slips-on-dollar-strength-2015-05-15 [5/15/15]
5 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [5/15/15]
6 – markets.wsj.com/us [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F15%2F14&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F15%2F14&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F15%2F14&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F14%2F10&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F14%2F10&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F14%2F10&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F16%2F05&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F16%2F05&x=0&y=0 [5/15/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F16%2F05&x=0&y=0 [5/15/15]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/15/15]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/15/15]
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, Mark is known as The 401k Advisor, Investor Coach, The Financial Advisor, The Financial Planner 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 financial Advisor services for professional athletes and individuals. Stonecreek is located in Salt Lake City, Murray, West Jordan, Sandy, Draper, South Jordan, Provo, Orem, Lehi, Highland, Alpine, and American Fork in Utah.
