CONSUMER SENTIMENT DECLINES JUST A BIT
Ending May at a mark of 97.1, the University of Michigan’s consumer sentiment index fell 0.6 points from its preliminary reading for the month. Economists polled by MarketWatch had forecast the gauge to remain at 97.7.1
FEWER HOMES WERE BOUGHT IN APRIL
Both new and existing home sales tapered off last month. The National Association of Realtors said that resales fell 2.3% for April, while the Census Bureau announced an 11.4% retreat for new home purchases. While demand was high, tight supply reduced the number of buyers.2
FED MINUTES: Q1 SLUMP “LIKELY TO BE TRANSITORY”
With the Federal Open Market Committee expressing that exact opinion in the record of its May 2-3 meeting, investors saw little that would delay the central bank from raising interest rates in June. Still, the minutes sounded a cautious note. Fed policymakers “generally judged that it would be prudent to await additional evidence,” confirming that the winter economic slowdown was short lived prior to tightening further. The Bureau of Economic Analysis did revise its Q1 GDP estimate up to 1.2% last week, compared with an initial evaluation of 0.7%.1,3
MORE RECORD HIGHS FOR NASDAQ, S&P 500
A great week for stocks saw gains of 2.08% for the Nasdaq Composite, 1.43% for the S&P 500, and 1.32% for the Dow Jones Industrial Average. Friday’s settlements: Dow, 21,080.28; S&P, 2,415.82; Nasdaq, 6,210.19. Friday’s S&P and Nasdaq closes were historic peaks for both indices. The S&P advanced for a seventh straight trading session to end the week, something it had not done since February. The Nasdaq 100 ended last week up 19.01% YTD.4,5
THIS WEEK: Monday is Memorial Day – U.S. stock and bond markets will be closed. Tuesday, the April personal spending report and PCE price index appear. A new Federal Reserve Beige Book and the NAR’s April pending home sales report surface Wednesday, plus earnings from Analog Devices, Hewlett-Packard Enterprise, Michael Kors, and Palo Alto Networks. Thursday is heavy on jobs data, as investors look at the ADP payroll and Challenger job-cut reports and the latest initial claims numbers; ISM’s May factory PMI also arrives, along with earnings from Boot Barn, Broadcom, Dollar General, Express, Five Below, and Lululemon Athletica. Friday, the Department of Labor issues its May employment report, and Hovnanian announces earnings.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +6.67 +18.24 +13.85 +5.61
NASDAQ +15.36 +26.69 +23.77 +14.29
S&P 500 +7.91 +15.58 +16.66 +5.94
REAL YIELD 5/26 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.44% 0.25% -0.38% 2.49%
Sources: wsj.com, bigcharts.com, treasury.gov – 5/26/175,6,7,8
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
“You cannot escape the responsibility of tomorrow by evading it today.”
– Abraham Lincoln
WEEKLY TIP
Some of the financial choices you make in the years just before and after your retirement may be unalterable. In recognition of that, an objective review of your retirement plan is a must as you approach your sixties.
WEEKLY RIDDLE
If you push me to extremes, I can rage and boil, but an hour later, I may be silent and stiff. What am I?
Last week’s riddle:
What four U.S. states have names that start and end with the same vowel?
Last week’s answer:
Alabama, Alaska, Arizona, and Ohio.
Citations.
1 – marketwatch.com/economy-politics/calendars/economic [5/26/17]
2 – foxbusiness.com/features/2017/05/24/existing-home-sales-slip-as-housing-shortage-weighs-on-activity-update.html [5/24/17]
3 – nytimes.com/2017/05/24/business/economy/fed-interest-rates-minutes.html [5/24/17]
4 – reuters.com/article/us-usa-stocks-idUSKBN18M18R [5/26/17]
5 – markets.wsj.com/us [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F26%2F16&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F26%2F16&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F26%2F16&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F25%2F12&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F25%2F12&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F25%2F12&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F25%2F07&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F25%2F07&x=0&y=0 [5/26/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F25%2F07&x=0&y=0 [5/26/17]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/26/17]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/26/17]
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.
