Weekly Market News for the Week of October 12, 2009

Presented by Mark Lund, The Investor Coach

Quote of the week. “Nothing can stop the man with the right mental attitude from achieving his goal; nothing on earth can help the man with the wrong mental attitude.”– Thomas Jefferson

Service sector grows again. Some great news from a closely watched indicator: last month, America’s service sector grew for the first time since August 2008. The Institute for Supply Management’s service sector index rose to 50.9 last month from 48.9 in August.¹

Metals make headlines. For most of last week, the dollar was weak, and that helped gold. Gold prices rose 4% on the week, settling Friday at $1.048.60 an ounce after reaching a new record peak ($1,056.30) on Thursday. Silver futures closed Friday at $17.69 an ounce. At the end of last week, gold was +18.6% for 2009. Other metals YTD as of last Friday? Silver, +56.6%; platinum, +42.3%; palladium, +71.6%.^2,3

Trade gap unexpectedly narrows. Surprise: our trade deficit unexpectedly slimmed down from $31.9 billion in July to $30.7 billion in August. The August data showed U.S. exports hitting a peak for 2009.⁴

More mall purchases. For the first time since July 2008, we have seen a year-over-year rise in sales among major retailers. Analysts expected mall sales to drop 1% last month, but the International Council of Shopping Centers reported a 0.6% gain for September.⁵

15-year FRMs averaging 4.33%. Freddie Mac has tracked these mortgages since 1991, and this is a new record low. A year ago, the average was 5.63%.⁶

What a difference a year makes. Bulls ruled Wall Street last week and we saw amazing Mon-Fri gains – the S&P 500 advanced 4.51%, the DJIA 3.98%, and the NASDAQ 4.45%.⁷

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

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. Name two English words (longer than two letters) that both begin and end with the letters “he” (in that order).

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

Last week’s riddle: What animal could become extinct worldwide, yet reappear about a year later?

Last week’s riddle answer: The mule.

Citations.
1 washingtonpost.com/wp-dyn/content/article/2009/10/05/AR2009100503631.html [10/6/09]
2 money.cnn.com/2009/10/09/markets/gold/?postversion=2009100914 [10/9/09]
3 reuters.com/article/usDollarRpt/idUSN098081020091009 [9/8/09]
4 forbes.com/2009/10/09/briefing-americas-open-markets-economy-trade.html [10/9/09]
5 nytimes.com/2009/10/09/business/09shop.html?em [10/9/09]
6 inman.com/news/2009/10/9/mortgage-rates-breaking-records [10/9/09]
7 cnbc.com/id/33246500 [10/9/09]
8 money.cnn.com/data/markets/dow/ [10/9/09]
8 money.cnn.com/data/markets/nasdaq/ [10/9/09]
8 money.cnn.com/data/markets/sandp/? [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F9%2F08&mode=add&symb=DJIA [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F8%2F04&mode=add&symb=DJIA [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F8%2F99&mode=add&symb=DJIA [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F9%2F08&mode=add&symb=COMP [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F8%2F04&mode=add&symb=COMP [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F8%2F99&mode=add&symb=COMP [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F9%2F08&mode=add&symb=SPX [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F8%2F04&mode=add&symb=SPX [10/9/09]
8 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=10%2F8%2F99&mode=add&symb=SPX [10/9/09]
9 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [10/9/09]
9 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [10/9/09]
10 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.