OIL REBOUND DRIVES STOCKS HIGHER
Thanks to frosty weather hitting the Northeast and a round of short covering, WTI crude settled at $32.19 on the NYMEX Friday – up 9% for the day and 9.4% for the week. Oil’s surge (and hopes of quantitative easing overseas) bolstered stocks: across four days, the Dow gained 0.66% to 16,093.51, the S&P 500 1.41% to 1,906.90, and the Nasdaq 2.29% to 4,591.18.1
EXISTING HOME SALES PACE IMPROVES 14.7%
This December jump in resales was partly due to November transactions being delayed by new closing rules. Regardless, 2015 was a good year for homebuying – existing home sales rose 7.7%, according to the National Association of Realtors.2
WEAK ENERGY PRICES HELP TO CURB INFLATION
Falling oil prices, rents, and food costs factored into the 0.1% December retreat of the Consumer Price Index (the core CPI rose 0.1%). The headline CPI advanced 0.7% in 2015 – the smallest annual increase in the past 50 years.3
BUILDER ACTIVITY TAILS OFF IN DECEMBER
The Census Bureau reported a 3.9% dip in building permits in December. Housing starts also declined 2.5% last month, but they were up 10.3% year-over-year.3
THIS WEEK: Monday, investors review earnings from Amgen, D.R. Horton, Halliburton, Kimberly-Clark, and McDonald’s. On Tuesday, a new Conference Board consumer confidence index arrives, plus the November S&P/Case-Shiller home price index and earnings from 3M, Apple, AT&T, Capital One, Chubb, Coach, Corning, Freeport-McMoRan, Grainger, Parker-Hannifin, Procter & Gamble, and U.S. Steel. December new home sales numbers and a Federal Reserve policy statement appear Wednesday, along with earnings from Ameriprise Financial, Anthem, Biogen, Boeing, Broadcom, Citrix, Dolby Labs, Discover, eBay, Facebook, General Dynamics, Hanesbrands, Norfolk Southern, PayPal, Qualcomm, SanDisk, Texas Instruments, and United Rentals. Thursday brings data on pending home sales and hard goods orders, initial claims numbers, and earnings from Abbott Labs, Airgas, Alibaba, Altria, Amazon, Bristol-Myers Squibb, Caterpillar, Celgene, Electronic Arts, Eli Lilly, Ford Motor Co., Harley-Davidson, JetBlue, Microsoft, Northrup Grumman, PulteGroup, Raytheon, Sherwin-Williams, Time Warner Cable, Under Armour, Stanley Black & Decker, Valero Energy, VISA, and Western Digital. The first estimate of Q4 GDP appears Friday, plus the University of Michigan’s final January consumer sentiment index and earnings from American Airlines, Chevron, Colgate-Palmolive, Honeywell International, MasterCard, Phillips 66, Praxair, Whirlpool, and Xerox.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -7.64 -9.66 +7.11 +5.09
NASDAQ -8.31 -3.35 +14.14 +10.43
S&P 500 -6.70 -7.57 +9.72 +5.12
REAL YIELD 1/22 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.72% 0.29% 1.20% 1.94%
Sources: wsj.com, bigcharts.com, treasury.gov – 1/22/164,5,6,7
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.
WEEKLY QUOTE
“Always be nice to people on the way up, because you’ll meet the same people on the way down.”
– Wilson Mizner
WEEKLY TIP
If you are in your forties and behind on your retirement planning, resist the temptation to direct more money into your child’s college fund than your retirement accounts.
WEEKLY RIDDLE
The more of them you will have, the longer you will live – but as you have more and more of them, the less you have left. What are they?
Last week’s riddle:
I weigh nothing, but you can see me. Put me in a box, and the box will become lighter. What am I?
Last week’s answer:
A hole.
Citations.
1 – cnbc.com/2016/01/22/us-markets.html [1/22/16]
2 – consumeraffairs.com/news/existing-home-sales-soar-in-december-012216.html [1/22/16]
3 – reuters.com/article/us-usa-economy-inflation-idUSKCN0UY1LH [1/20/16]
4 – markets.wsj.com/us [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F22%2F15&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F22%2F15&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F22%2F15&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F21%2F11&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F21%2F11&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F21%2F11&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=1%2F20%2F06&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=1%2F20%2F06&x=0&y=0 [1/22/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=1%2F20%2F06&x=0&y=0 [1/22/16]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [1/22/16]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [1/22/16]
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.
