Free Market News for the Week of May 24, 2010

Presented by Mark Lund, The Investor Coach.

Quote of the week. “To succeed in life, you need three things: a wishbone, a backbone and a funny bone.”– Reba McEntire

Attention on Europe (and the Senate). The euro thankfully rose for three straight days last week, after hitting a four-year low after German chancellor Angela Merkel commented that the EU/IMF debt bailout had “done no more than buy time” to fix the crisis. Thursday evening, the Senate passed its version of the financial industry reform bill; the next step is reconciliation with the House version. Stocks were hit hard early in the week, but managed Friday gains; a late rally took the Dow north 125 points.1,2,3

Consumer, producer prices retreat. This was surprising: the CPI declined 0.1% in April as energy prices fell by 1.4%. The PPI also decreased 0.1%. The Commerce Department reported a 0.9% year-over-year increase in the CPI, well below the Federal Reserve’s annual inflation target of 1.5-2.0%.4,5

Indicators streak ends. The Conference Board’s index of leading indicators slipped 0.1% last month, the first dip since March 2009. Economists surveyed by Thomson Reuters had forecast a 0.2% increase.6

Housing starts rise, permits fall. Overall housing starts increased by 5.8% in April to the highest level since October 2008, with a 10.0% rise in single-family construction. However, the Commerce Department had building permits down by 11.5% – an effect of expiring federal tax credits.7

Bulls try to hold their ground. All three major U.S. indices slipped between 4-5% last week. However, the S&P rose 1.50% Friday to end the week at 1,087.69. At Friday’s close, the Dow was at 10,193.39 and the NASDAQ at 2,229.04.8

% Change


1-Yr Chg

5-Yr Avg

10-Yr Avg











S&P 500





Real Yield


1 Yr Ago

5 Yrs Ago

10 Yrs Ago






(Source:,,,, 5/21/10)9,10,11,12
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. The railings on a 60-yard-long walkway have ornamental sculptures every 12 yards on both sides, starting at the east and west ends of the walkway. How many total sculptures are there on the walkway?

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

Last week’s riddle: What number logically comes next in this series: 2, 3, 5, 9, 17, __.

Last week’s riddle answer: 33. (The difference between the two numbers is progressively multiplied by 2 and added to the next number.)

1 – [5/17/10]
2 – [5/21/10]
3 – [5/21/10]
4 – [5/19/10]
5 – [5/20/10]
6 – [5/20/10]
7 – [5/18/10]
8 – [5/21/10]
9 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
10 – [5/21/10]
11 – [5/21/10]
11 – [5/21/10]
12 – [1/12/00]

This material was prepared by Peter Montoya Inc, and does not necessarily represent the views of the presenting Representative’s Broker/Dealer. This information 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. 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.