OCTOBER WAS A GREAT MONTH FOR JOB GROWTH
Employers added 271,000 new jobs last month according to the Labor Department, far surpassing the Bloomberg consensus forecast of 182,000. The jobless rate ticked down to an even 5.0% while the U-6 rate measuring “total” unemployment fell to 9.8%. Wages also rose nine cents to $25.20, up 2.5% in 12 months; that is the largest yearly improvement in six years. If November hiring compares to this, the Federal Reserve may be encouraged to raise interest rates in December.1
NOTABLE EXPANSION IN THE SERVICE SECTOR
The Institute for Supply Management’s non-manufacturing PMI hit 59.1 for October, rising 2.2 points. At the same time, ISM’s manufacturing PMI ticked down to a troubling 50.1, indicating minimal sector growth in the year’s tenth month. The two indices have not seen a 9-point difference in 14 years.2
A DISAPPOINTING SOCIAL SECURITY CHANGE
April 30, 2016 will mark the last day that some married couples will be able to use the file-and-suspend strategy to claim Social Security benefits. In addition, divorced people born after January 2, 1954 will no longer be able to file a restricted application for Social Security benefits after that date. This is all due to passage of the Bipartisan Budget Act of 2015. Married couples may still employ restricted application and file-and-suspend strategies until April 30, as long as one spouse will be age 66 at that date while the other spouse will be age 62 or older in 2015.3,4
ANOTHER WEEK OF GAINS
Across five days, the S&P 500 added another 0.95% to settle at 2,099.20 Friday. The index is up 6.02% in the past month. The Nasdaq ended the week at 5,147.12, rising 1.85%; the Dow’s weekly gain was 1.40%, and that took the blue chips to a Friday close of 17,910.33.5
THIS WEEK: Wall Street looks at earnings from Dean Foods, DISH Network, Hertz Global, Jamba, Lions Gate Entertainment and Priceline Group on Monday. Tuesday’s earnings parade includes results from Beazer Homes, D.R. Horton, and Tribune Media. On Wednesday, earnings arrive from Dillard’s, Macy’s, NetEase, Popeyes, and Smart & Final. A new initial claims report appears Thursday, plus results from Advance Auto Parts, Applied Materials, Cisco, El Pollo Loco, Fossil, Kohl’s, Nordstrom, and Planet Fitness. On Friday, investors examine October retail sales figures, the October PPI, the initial November University of Michigan consumer sentiment index, and Q3 results from J.C. Penney.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +0.49 +2.03 +11.30 +6.92
NASDAQ +8.68 +10.97 +19.92 +13.62
S&P 500 +1.96 +3.35 +14.25 +7.17
REAL YIELD 11/6 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.75% 0.45% 0.48% 2.03%
Sources: wsj.com, bigcharts.com, treasury.gov – 11/6/156,7,8,9
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
“Sooner or later we all quote our mothers.”
– Bernard Williams
WEEKLY TIP
If you own a business and need a new credit card, do a little research. If you travel frequently, a card offering travel perks or insurance might be ideal. If you know you will have an outstanding monthly balance, look for a low interest rate.
WEEKLY RIDDLE
When you shop for clothes, XL is always larger than L…but clothing sizes aside, in what numerical context is L larger than XL?
Last week’s riddle:
What 5-letter word for a type of crop can you remove 2 letters from, then rearrange the 3 letters left to make the word “tea”?
Last week’s answer:
Wheat.
Citations.
1 – usatoday.com/story/money/2015/11/06/october-jobs-report/75247628/ [11/6/15]
2 – usnews.com/news/business/articles/2015/11/04/private-survey-growth-of-us-services-sector-surged-in-oct [11/4/15]
3 – cbsnews.com/news/new-rules-for-social-security-claiming-strategies/ [11/4/15]
4 – marketwatch.com/story/social-security-changes-will-hit-couples-divorced-women-hard-2015-11-06 [11/6/15]
5 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [11/6/15]
6 – markets.wsj.com/us [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F6%2F14&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F6%2F14&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F6%2F14&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F5%2F10&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F5%2F10&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F5%2F10&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F7%2F05&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F7%2F05&x=0&y=0 [11/6/15]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F7%2F05&x=0&y=0 [11/6/15]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [11/6/15]
9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [11/6/15]
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 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.
