Jul

6

Growth Report for Monday, July 6, 2015

WALL STREET HANGS ON AS GREECE DEFAULTS
When Greece revealed it would miss its July 1 debt payment to the International Monetary Fund last Tuesday, the Dow lost 2% for the day while the CBOE VIX gained more than 35%. (To add to the drama, the commonwealth of Puerto Rico stated that its debts were “not payable” on the same day.) Any further bailout of Greece may hinge on its July 5 national popular vote, in which Greeks will decide whether or not to stay in the euro. Stocks did rebound mildly, resulting in the following weekly performances for the major indices: DJIA, -1.22% t0 17,730.11; NASDAQ, -1.90% to 5,009.21; S&P 500, -1.29% to 2,076.78.1,2,5

ANOTHER SOLID JOBS REPORT, WITH AN ASTERISK
Employers added 223,000 more jobs in June, Labor Department data revealed Friday. The headline jobless rate fell to 5.3% and the U-6 rate measuring “total” unemployment declined to 10.5%, but that was partly due to the labor force participation rate hitting a 38-year low of 62.6.3

FACTORIES WERE A BIT BUSIER IN JUNE
So indicated the Institute for Supply Management’s newest manufacturing purchasing manager index. ISM’s factory PMI rose 0.7 points in May to a mark of 53.5, another indication of an economy picking up momentum in spring.4

KEY CONFIDENCE BAROMETER RISES
The Conference Board’s consumer confidence index beat expectations by topping the century mark in June. It rose 6.8 points from its (revised) May level to 101.4.4

NAR, CASE-SHILLER INDICES DISAPPOINT
Last week’s real estate indicators were a touch underwhelming. Analysts polled by Briefing.com thought April’s 20-city Case-Shiller home price index would show a 5.6% overall yearly gain; instead, the 12-month improvement was 4.9%. The National Association of Realtors said its pending home sales index rose 0.9% in May; the consensus in the same poll was for a 1.4% increase.4

THIS WEEK: Monday, Wall Street will react to the Greek bailout referendum and consider ISM’s June non-manufacturing PMI. Nothing major is slated for Tuesday. Wednesday, the June Federal Reserve policy meeting minutes arrive and Alcoa releases Q2 results to kick off the new earnings season. On Thursday, the Street looks at new initial claims figures plus earnings from PepsiCo, Barracuda Networks and PriceSmart. Friday, Fed chair Janet Yellen speaks on the U.S. economic outlook in Cleveland; also, a Census Bureau report on May’s wholesale inventories appears.

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -0.52 +4.44 +16.61 +7.21
NASDAQ +5.77 +12.37 +27.89 +14.35
S&P 500 +0.87 +5.17 +20.62 +7.39
REAL YIELD 7/2 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.49% 0.38% 1.27% 1.75%

Sources: wsj.com, bigcharts.com, treasury.gov – 7/2/155,6,7,8
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

“Whatever you fear most has no power – it is your fear that has the power.”

– Oprah Winfrey

WEEKLY TIP

If you and your child are visiting some prospective colleges this summer, ask if you can chat with someone in their financial aid offices. The contacts you make (and the notes you take) could prove important for the future.

WEEKLY RIDDLE

What has no arms, legs or form, yet goes up without ever coming down?

Last week’s riddle:
Constantly hungry, I must always be fed – and any finger I touch will soon turn red. What am I?

Last week’s answer:
Fire.

Citations.
1 – cbsnews.com/news/rising-grexit-risk-is-beating-down-stocks/ [6/30/15]
2 – thestreet.com/story/13207489/1/stocks-close-lower-ahead-of-greek-vote-on-bailout.html [7/2/15]
3 – tinyurl.com/nquvoqy [7/2/15]
4 – briefing.com/investor/calendars/economic/2015/06/29-03 [7/2/15]
5 – markets.wsj.com/us [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F2%2F14&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F2%2F14&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F2%2F14&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F2%2F10&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F2%2F10&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F2%2F10&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F1%2F05&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F1%2F05&x=0&y=0 [7/2/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F1%2F05&x=0&y=0 [7/2/15]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [7/2/15]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [7/2/15]

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.

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About the Author ()

Mark K. Lund is the firm's founder, CEO and author of The Effective Investor, a #1 Best Seller. He has written articles for or been quoted in: The Wall Street Journal, The Salt Lake Tribune, The Enterprise Newspaper, The Utah Business Connect Magazine, US News & World Report, and Newsmax.com, just to name a few.  Mark publishes two newsletters called, “The Mark Lund Growth Report” and “Mark Lund on Money.”  Mark provides CPE (continuing professional education) courses for CPAs.  You may also have seen him on KUTV Channel 2, or as a guest speaker at a local association or business. Mark provides investment and retirement planning services for individuals and 401(k) consulting for small businesses. In his book, The Effective Investor, Mark exposes the false narrative magazines, media, big Wall Street firms, and most advisors want you to believe. The good news is that Mark will show you that you don’t need their speculative ways of investing in order to be successful. Get a free copy when you schedule your initial consultation.

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