Weekly Market News for the Week of October 19, 2009

Presented by Mark Lund, The Investor Coach.

Quote of the week. “Life is 10% of what happens to me and 90% of how I react to it.”– John Maxwell

A consumer rebound? While U.S. retail sales fell 1.5% in September without the C.A.R.S. program, there was a hidden positive. Minus automotive purchases, total retail sales rose 0.5% last month. Economists polled by Briefing.com had forecast a 2.1% overall sales decline and +0.2% sales ex-auto.¹

The latest on inflation. In September, the U.S. Consumer Price Index rose 0.2%. Core CPI also rose 0.2%. From September 2008 to September 2009, CPI fell 1.3% while core CPI rose 1.5%.²

No 2010 SSI COLA. Chalk it up to CPI: Social Security incomes will stay flat next year. Last week, President Obama lent his support for a $250 one-time stimulus check for those receiving SSI and federal pensions. Basic Medicare Part B premiums won’t go up in 2010 either. Neither will 401(k) contribution limits, according to the I.R.S.³

A consumer confidence asterisk. Analysts polled by MarketWatch expected a 72.0 preliminary reading from the Reuters/University of Michigan consumer sentiment index this month. Instead, the index came in at 69.4, which weighed on stocks Friday.⁴

Oil gains 9.4% in a week. Demand is certainly back – crude futures closed at a 52-week high of $78.53 per barrel on the NYMEX Friday.⁵

Industry is healthy. Last week, the Federal Reserve noted that industrial output rose 5.2% in 3Q 2009. This represents the first increase since the recession began and the best quarter in four years.⁵

Dow reaches 10,000. It didn’t stay there Friday: it gained 1.3% last week, but settled at 9,995.91 at the bell. The S&P 500 closed the week at 1,087.68, and the NASDAQ wrapped up Friday at 2,156.80.⁶

(Source: CNNMoney.com, ustreas.gov, bls.gov, 10/16/09)^7,8,9

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.

Riddle of the week. What is the timepiece with the most moving parts? (It’s been around for centuries.)

Contact my office or see next week’s Update for the answer.

Last week’s riddle: Name two English words (longer than two letters) that both begin and end with the letters “he” (in that order).

Last week’s riddle answer: Headache and heartache.

Citations.
1 money.cnn.com/2009/10/14/news/economy/September_retail_sales/?postversion=2009101409 [10/14/09]
2 msnbc.msn.com/id/33344177/ns/business-businessweekcom/ [10/15/09]
3 baltimoresun.com/business/bal-bz.cola16oct16,0,2468505.story [10/15/09]
4 marketwatch.com/story/consumer-sentiment-drops-in-oct-2009-10-16 [10/16/09]
5 marketwatch.com/story/oil-futures-tap-fresh-one-year-high-atop-78-2009-10-16 [10/16/09]
6 cnbc.com/id/33347221 [10/16/09]
7 money.cnn.com/data/markets/dow/ [10/16/09]
7 money.cnn.com/data/markets/nasdaq/ [10/16/09]
7 money.cnn.com/data/markets/sandp/? [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F16%2F08&mode=add&symb=DJIA [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F15%2F04&mode=add&symb=DJIA [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F15%2F99&mode=add&symb=DJIA [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F16%2F08&mode=add&symb=COMP [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F15%2F04&mode=add&symb=COMP [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F15%2F99&mode=add&symb=COMP [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F16%2F08&mode=add&symb=SPX [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F15%2F04&mode=add&symb=SPX [10/16/09]
7 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F15%2F99&mode=add&symb=SPX [10/16/09]
8 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [10/16/09]
8 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [10/16/09]
9 treasurydirect.gov/instit/annceresult/press/preanre/1999/ofn100699.pdf [10/6/99]

These views are those of Peter Montoya Inc., and not the presenting Representative or the Representative’s Broker/Dealer, and should not be construed as investment advice. 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. 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. The 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 other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards.