A BIT MORE OPTIMISM AS SEPTEMBER ENDS
The University of Michigan’s consumer sentiment index advanced slightly in the past couple of weeks, rising to a final September mark of 87.2 from its initial reading of 85.7. Regardless, this was the index’s poorest final monthly reading since October 2014. It did surpass the expectations of analysts polled by Bloomberg, who expected a final number of 86.5.1
DIFFERENT DIRECTIONS FOR AUGUST HOME SALES
New home buying increased 5.7% during the month of August, and the sales pace was the strongest measured by the Census Bureau since February 2008. This put new home sales up 21.6% year-over-year. On the other hand, National Association of Realtors data showed resales slumping 4.8% last month.2
DURABLE GOODS ORDERS RETREAT 2.0%
The August reduction matched the consensus forecast at Briefing.com. Beneath the headline number, core durable goods orders (excluding the transportation category) were flat in August.3
Q2 GDP REVISED UP TO 3.9%
This is 0.2% better than the previous estimate from the Bureau of Economic Analysis. Household consumption grew at a 3.6% annual pace in Q2 – double what it was in Q1. Residential construction grew at a 9.3% pace in the quarter, business investment at a 5.2% rate.1
A DOWN WEEK FOR EQUITIES
Last week saw the major U.S. indices pull back. On Friday, the Dow Jones Industrial Average settled at 16314.67, the S&P 500 at 1,931.34 and the Nasdaq Composite at 4,686.50. On the week, the Dow lost 0.43%, the S&P 1.36%, and the Nasdaq 2.92%.4
THIS WEEK: August consumer spending figures arrive Monday along with NAR’s latest pending home sales index. Tuesday, the July Case-Shiller home price index and the Conference Board’s September consumer confidence index appear, along with earnings from Barracuda Networks, Costco, and Diamond Foods. Wednesday brings ADP’s September job-change report and quarterly results from Paychex; also, Federal Reserve chair Janet Yellen speaks at a banking conference in St. Louis. On Thursday, Wall Street will watch September’s ISM factory PMI, the September Challenger job-cut report and the latest initial jobless claims figures. The Labor Department issues its September employment report Friday.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -8.46 -3.72 +10.04 +5.62
NASDAQ -1.05 +4.92 +19.36 +12.09
S&P 500 -6.20 -1.76 +13.63 +5.89
REAL YIELD 9/25 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.71% 0.50% 0.81% 1.78%
Sources: wsj.com, bigcharts.com, treasury.gov – 9/25/155,6,7,8
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
“Sometimes life is going to hit you in the head with a brick. Don’t lose faith.”
– Steve Jobs
WEEKLY TIP
How many of us think about saving first, spending second? Most households save or invest whatever is left after monthly expenses. Would our savings (and wealth) grow faster if we saw things the other way around?
WEEKLY RIDDLE
Take a letter out of it, and it stays put and the same; remove all the letters from it and it still stays put and stays the same. What is it?
Last week’s riddle:
Brittany carried a load of wood in a wheelbarrow, yet the wood was neither straight nor crooked. How could this be?
Last week’s answer:
She was carrying a load of sawdust.
Citations.
1 – bloomberg.com/news/articles/2015-09-25/economy-in-u-s-picked-up-on-consumer-spending-construction [9/25/15]
2 – housingwire.com/articles/35142-new-home-sales-climb-57-in-august [9/24/15]
3 – briefing.com/investor/calendars/economic/2015/09/21-25 [9/25/15]
4 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [9/25/15]
5 – markets.wsj.com/us [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F25%2F14&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F25%2F14&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F25%2F14&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F24%2F10&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F24%2F10&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F24%2F10&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F26%2F05&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F26%2F05&x=0&y=0 [9/25/15]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F26%2F05&x=0&y=0 [9/25/15]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [9/25/15]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [9/25/15]
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.
