HOUSEHOLD SENTIMENT GAUGE RISES AGAIN
The University of Michigan’s Index of Consumer Sentiment gained 0.4 points from its preliminary reading this month to reach a final January mark of 98.5. That represents a 12-year peak for the index, which stood at 92.0 in January 2016.1,2
HOME SALES FELL IN DECEMBER
Given costlier mortgages, rising prices, and tight inventory, the December retreat for resales was not surprising. The National Association of Realtors said that existing home sales slipped by 2.8% last month. New home sales dropped 10.4%, but the Census Bureau stated that they increased 12.2% for 2016, marking the best year for new home buying since 2007.3
FIRST ESTIMATE OF q4 GDP: 1.9%
If that Department of Commerce appraisal holds, it will mean that the economy grew just 1.9% for all of 2016, contrasting with 2.6% expansion in 2015. Hard goods orders fell 0.4% in December, but rose 1.7% minus defense orders.2
DOW TOPS 20,000, STOCKS REGAIN MOMENTUM
Leaving some mid-January doldrums behind, the major indices rallied nicely last week. The Dow advanced 1.34% to 20,093.78; the Nasdaq Composite, 1.90% to 5,660.78; and the S&P 500, 1.03% to 2,294.69. The CBOE VIX “fear index” finished the week down at 10.53.4
THIS WEEK: Monday offers reports on December personal spending and pending home sales. The Conference Board’s monthly consumer confidence index and a new Case-Shiller home price index appear Tuesday, along with earnings from Aetna, Aflac, Ally Financial, Anadarko Petroleum, Apple, Chubb, Coach, Eli Lilly, ExxonMobil, Harley-Davidson, MasterCard, Nucor, Pfizer, Sprint, Under Armour, UPS, U.S. Steel, Valero Energy, and Xerox. Wednesday, the Federal Reserve wraps up a policy meeting, ADP’s January payrolls report and ISM’s January manufacturing PMI arrive, and Allstate, Altria, AmeriGas, Ameriprise Financial, Anthem, Avery Dennison, Celanese, Energizer Holdings, Exelon, Facebook, Ingersoll-Rand, MetLife, Pitney Bowes, and Symantec all announce earnings. Thursday’s earnings parade includes results from Amazon, Amgen, Callaway Golf, Chipotle, Cigna, ConocoPhillips, Coty, Estee Lauder, GoPro, Hanesbrands, International Paper, Motorola Solutions, Parker, Philip Morris, Merck, Ralph Lauren, Ryder, Sirius XM, SkyWest, Snap-On, and Visa; also, Challenger issues January job-cut data, and new initial claims figures are released. Investors consider the January ISM services PMI and January hiring figures Friday, plus earnings from AutoNation, Clorox, Hershey, Phillips 66, Regis, and Weyerhaeuser.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +1.68 +26.02 +11.74 +6.09
NASDAQ +5.16 +26.69 +20.20 +13.24
S&P 500 +2.50 +21.87 +14.86 +6.14
REAL YIELD 1/27 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.41% 0.62% -0.18% 2.48%
Sources: wsj.com, bigcharts.com, treasury.gov – 1/27/174,5,6,7
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.
“True silence is the rest of the mind; it is to the spirit what sleep is to the body, nourishment and refreshment.”
– William Penn
WEEKLY TIP
If you want to retire to another area, think about whether it makes sense for you financially as well as socially. Will you be able to find part-time work there, if needed? Could local economic factors make the area less affordable for you someday?
WEEKLY RIDDLE
Double S, double P, it has four Is and not one C. What oft-seen 11-letter word is this?
Last week’s riddle:
A bus without passengers pulls into Tucson, where 10 passengers board it. In Las Cruces, 5 passengers get off the bus, and twice as many passengers get on as in Tucson. Then in El Paso, 25 passengers get off the bus. How many people are on the bus as it leaves El Paso?
Last week’s answer:
Just one person – the bus driver.
Citations.
1 – sca.isr.umich.edu/ [1/27/17]
2 – thestreet.com/story/13969585/1/stocks-mixed-after-u-s-gdp-shows-mediocre-end-to-2016.html [1/27/17]
3 – usatoday.com/story/money/2017/01/26/new-home-sales-prices-mortgage-rates/97081430/ [1/26/17]
4 – markets.wsj.com/us [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F27%2F16&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F27%2F16&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F27%2F16&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F27%2F12&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F27%2F12&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F27%2F12&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F26%2F07&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F26%2F07&x=0&y=0 [1/27/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F26%2F07&x=0&y=0 [1/27/17]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [1/27/17]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [1/27/17]
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.
