MORE MILD INFLATION
Consumer prices ticked up 0.1% for January while wholesale prices rose 0.2%. Analysts polled by MarketWatch expected both the headline Consumer Price Index and Producer Price Index to advance 0.1%. The bigger news item (perhaps) is that the Labor Department altered its calculation of producer prices for the first time in 36 years. The definitive PPI is now called the PPI Final Demand index, and it measures prices received for exports, services, federal government purchases and construction in addition to those of finished goods.1,2
POOR HOME SALES TO START THE YEAR
The annual pace of existing home sales hit an 18-month low in January; the National Association of Realtors announced 5.1% monthly and yearly declines in residential resales. The good news? Inventory continues to expand (+2.2% in January) and the median existing home price was $188,900 last month, up 10.7% from a year ago.3
OIL TOPS $102, GOLD ADVANCES FOR A THIRD WEEK
NYMEX crude for April delivery settled at $102.20 a barrel Friday, rising 1.9% for the week. Unrest in Ukraine, Venezuela, Turkey and other emerging markets also influenced the 0.4% gain for COMEX gold futures last week – the precious metal settled Friday at $1,323.60 per ounce.4
NASDAQ ADDS TO YTD GAINS
The tech-heavy benchmark rose 0.46% during this past abbreviated trading week, wrapping up Friday at 4,263.41; in contrast, the Dow and S&P 500 each slipped a bit over four days. After a 0.32% weekly loss, the Dow stood at 16,103.30. The S&P settled Friday at 1,836.25, losing 0.13% on the week.5
THIS WEEK: Berkshire Hathaway, Hertz and Live Nation announce earnings Monday. Tuesday, the Conference Board publishes its February consumer confidence index, the December Case-Shiller and FHFA home price indices appear, and Big 5, Office Depot, CoreLogic, Metro PCS, Papa John’s, Toll Brothers, Macy’s, Home Depot, Alleghany, Molycorp, Dreamworks and Cracker Barrel all present earnings. Wednesday offers January new home sales numbers and earnings from Baidu, TJX, Starwood Hotels, JC Penney and U.S. Cellular. Thursday, Fed chair Janet Yellen reports to Congress and new initial claims figures and data on January hard goods orders arrive; quarterly results come from Salesforce, Wendy’s, Hilton, Monster, Sempra Energy, Main Street Capital and Republic Airways. Friday brings the month’s final University of Michigan consumer sentiment index, NAR’s report on January pending home sales, and the second federal estimate of Q4 GDP.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -2.86 +16.01 +23.73 +5.16
NASDAQ +2.08 +36.15 +39.16 +10.92
S&P 500 -0.66 +22.22 +27.69 +6.05
REAL YIELD 2/21 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.61% -0.54% 1.67% 1.79%
Sources: USATODAY.com, bigcharts.com, treasury.gov – 2/21/146,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.
WEEKLY QUOTE
“Better shun the bait than struggle in the snare.”
– John Dryden
WEEKLY TIP
As you insure your life, think about the death benefit of the policy and its potential uses after you are gone.
WEEKLY RIDDLE
I’m comprised of solid ground, and yet I see water all around. What exactly am I?
Last week’s riddle:
Each morning, I show up at your feet, yet at midday I nearly retreat. No matter how fast you move, I follow. What am I? ?
Last week’s answer:
Your shadow.
Citations.
1 – marketwatch.com/economy-politics/calendars/economic [2/21/14]
2 – bloomberg.com/news/2014-02-18/producer-price-index-in-u-s-gets-first-overhaul-since-1978.html [2/18/14]
3 – 247wallst.com/housing/2014/02/21/january-sales-of-existing-homes-at-18-month-low/ [2/21/14]
4 – proactiveinvestors.com/companies/news/52249/gold-rises-05-oil-above-102-52249.html [2/21/14]
5 – fxstreet.com/news/forex-news/article.aspx?storyid=f0ae7598-7cbc-41c0-a5ff-1f741e2d583b [2/21/14]
6 – usatoday.com/money/markets/overview/ [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F21%2F12&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F21%2F12&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F21%2F13&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F20%2F09&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F20%2F09&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F20%2F09&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F20%2F04&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F20%2F04&x=0&y=0 [2/21/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F20%2F04&x=0&y=0 [2/21/14]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [2/21/14]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [2/21/14]
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, The 401k Advisor, Investor Coach 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 private investment management services for select individuals. Stonecreek is located in Salt Lake City and Provo Utah.
