Growth Report for Monday, May 9, 2016

APRIL JOBS REPORT RAISES QUESTIONS
Employers hired 160,000 more workers than they let go last month, and that net job gain was the smallest since September. Does this suggest a job market losing steam, or does it hint at an economy nearing full employment? The hiring number may make the Federal Reserve reconsider the possibility of a June interest rate hike. Average hourly wages improved to $25.53 in April, up 2.5% year-over-year. While the main jobless rate remained at 5.0%, the U-6 rate, counting both the unemployed and underemployed, declined 0.1% to 9.7%.1

MORE EXPANSION IN FACTORY & SERVICE SECTORS
Both of the Institute for Supply Management’s purchasing manager indices were above the critical 50 level (indicating growth) in April. ISM’s manufacturing index came in at 50.8, its non-manufacturing index at 55.7. Economists surveyed by MarketWatch expected a 51.4 reading for the factory PMI and a 54.7 reading for the services PMI.2

OIL SETTLES UNDER $45
Light sweet crude closed at $44.66 Friday on the NYMEX, down 2.7% for the week on perceptions that near-term supply was exceeding demand. Gold got a boost from the disappointing jobs data, settling at $1,294.00 Friday to go up 0.3% for the week.3,4

WALL STREET SEES A MINOR WEEKLY RETREAT
Across May 2-6, the S&P 500 lost 0.40% to 2,057.14; the Nasdaq Composite, 0.82% to 4,736.16; and the Dow Jones Industrial Average, 0.19% to 17,740.63. Headwinds included the underwhelming jobs report, the weaker-than-expected ISM factory PMI and the week’s dip in oil prices.5

THIS WEEK: On Monday, earnings from Chimerix, Hertz Global, Nautilus, Novatel Wireless, TeamHealth, and Tyson Foods arrive. Dean Foods, Electronic Arts, Norwegian Cruise Line, Planet Fitness, Tribune Media, and Walt Disney Co. present earnings Tuesday. Wednesday, the earnings parade includes announcements from Aramark, Jack in the Box, Macy’s, NetEase, Weibo, and Wendy’s. Thursday, the latest initial claims figures complement earnings news from Dillard’s, Kohl’s, Nordstrom, Ralph Lauren, Shake Shack, and Symantec. April retail sales data, the April Producer Price Index, and the initial May consumer sentiment index from the University of Michigan all appear Friday, along with Q1 results from J.C. Penney.

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +1.81 -0.57 +8.07 +5.32
NASDAQ -5.42 -3.73 +13.50 +10.22
S&P 500 +0.65 -1.11 +10.70 +5.52
REAL YIELD 5/6 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.18% 0.34% 0.71% 2.45%

Sources: wsj.com, bigcharts.com, treasury.gov – 5/6/166,7,8,9
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 TIP

In your business budget, think of your marketing costs as a percentage of sales, somewhere between 2-10%. If you are building a brand, those costs might need to approach or exceed 20% of sales.

WEEKLY RIDDLE

I can easily be divided. Within me, you will notice 13 hearts, but no organs. What am I?

Last week’s riddle:
It cannot see and it feels no pain, despite matter constantly going through its eye. What is it?

Last week’s answer:
A sewing needle.

Citations.
1 – forbes.com/sites/samanthasharf/2016/05/06/jobs-report-u-s-adds-160000-jobs-in-april-unemployment-rate-steady-at-5/ [5/6/16]
2 – marketwatch.com/economy-politics/calendars/economic [5/6/16]
3 – marketwatch.com/story/oil-prices-dip-as-focus-returns-to-global-supply-glut-2016-05-06/ [5/6/16]
4 – marketwatch.com/story/gold-stocks-step-higher-ahead-of-jobs-report-2016-05-06 [5/6/16]
5 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [5/6/16]
6 – markets.wsj.com/us [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F6%2F15&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F6%2F15&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F6%2F15&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F6%2F11&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F6%2F11&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F6%2F11&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F5%2F06&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F5%2F06&x=0&y=0 [5/6/16]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F5%2F06&x=0&y=0 [5/6/16]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/6/16]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/6/16]

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 a Wealth Advisor, 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 investment and retirement planning for individuals and 401k consulting for small businesses. Stonecreek is located in Salt Lake City, Murray City, West Jordan City, Sandy City, Draper City, South Jordan City, Provo City, Orem City, Lehi City, Highland City, Alpine City, and American Fork City in Utah.

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