MIXED RESULTS FROM CONSUMER INDICES
Wet, cold weather didn’t dampen the consumer outlook in February – at least according to the month’s final University of Michigan consumer sentiment index, which came in at 81.6. The index finished January at 81.2. On the other hand, February’s Conference Board consumer confidence index slipped 1.3 points to 78.1 (January’s reading was revised down to 79.4).1,2
PACE OF NEW HOME SALES PICKS UP
Wall Street and Main Street cheered the Census Bureau’s announcement of a 9.6% jump in new home buying in January – the rate of new home sales was the best in any month since July 2008. The National Association of Realtors’ pending home sales index rose 0.1% in January, a nice change from the 9% fall it took in the past year. December’s S&P/Case-Shiller Home Price Index showed a 13.4% yearly gain in home values, down from a 13.7% improvement in the November edition.2,3
Q4 GDP REVISED SIGNIFICANTLY DOWNWARD
Last week, the Bureau of Economic Analysis lowered its fourth-quarter growth estimate from 3.2% to 2.4%. This did not shock economists – in a MarketWatch poll, the consensus was for a 2.4% reading. Lagging economic indicators released in February were worse than anticipated. In news pertaining to Q1 GDP, January saw a 1.0% drop in overall durable goods orders.2
STOCKS END FEBRUARY AT NEW RECORD HIGH
On February 28, the S&P 500 settled at a new record close of 1,859.45 and a gain of 1.26% on the week, even with growing concerns about Russian military action in Ukraine. The Dow stood at 16,321.71 after a 1.36% weekly advance; the NASDAQ ended the week at 4,308.12 with a 5-day gain of 1.05%.4,5,6
THIS WEEK: Monday, the January consumer spending report arrives from the Commerce Department, along with ISM’s February manufacturing PMI, data on February auto sales, and earnings from Acura and Icahn Enterprises. Tuesday, quarterly results are out from AutoZone, Smith & Wesson and Radio Shack. ISM’s February service sector PMI comes out Wednesday, plus a new Federal Reserve Beige Book, the latest ADP employment change report and earnings from Revlon, BigLots! and PetSmart. Thursday brings the new Challenger job-cut report, new initial claims data, a report on January factory orders and earnings from Kroger, H&R Block, Pandora, Costco and Chesapeake Utilities; a European Central Bank policy meeting also occurs. The Labor Department’s February employment report will be released Friday.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -1.54 +16.13 +26.22 +5.42
NASDAQ +3.15 +36.32 +42.53 +11.22
S&P 500 +0.60 +22.76 +30.59 +6.24
REAL YIELD 2/28 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.49% -0.64% 2.06% 1.61%
Sources: CNNMoney.com, bigcharts.com, treasury.gov – 2/28/144,5,6,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.
WEEKLY QUOTE
“One man practicing sportsmanship is better than a hundred teaching it.”
– Knute Rockne
WEEKLY TIP
Consider scheduling automated bill payments and account transfers. It could remove some “busy work” from your financial life.
WEEKLY RIDDLE
I have rosy cheeks, I am round and cute – yet debate persists over whether I am vegetable or fruit. What might I be?
Last week’s riddle:
I’m comprised of solid ground, and yet I see water all around. What exactly am I?
Last week’s answer:
An island.
Citations.
1 – reuters.com/article/2014/02/28/us-usa-economy-sentiment-idUSBREA1R12S20140228 [2/28/14]
2 – marketwatch.com/economy-politics/calendars/economic [2/28/14]
3 – dailyfinance.com/2014/02/28/contracts-buy-homes-barely-budge-january/ [2/28/14]
4 – money.cnn.com/data/markets/dow/ [2/28/14]
5 – money.cnn.com/data/markets/nasdaq/ [2/28/14]
6 – money.cnn.com/data/markets/sandp/ [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F28%2F12&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F28%2F12&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F28%2F13&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F27%2F09&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F27%2F09&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F27%2F09&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F27%2F04&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F27%2F04&x=0&y=0 [2/28/14]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F27%2F04&x=0&y=0 [2/28/14]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [2/28/14]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [2/28/14]
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.
