WEEKLY QUOTE
“Innovation is saying ‘no’ to 1,000 things.”
– Steve Jobs
HIRING IMPROVES…WITH A FOOTNOTE
Economists polled by MarketWatch had expected non-farm payrolls to increase by 59,000 for September. In a nice surprise, the economy added 103,000 jobs. However, 45,000 of those “hires” were actually striking Verizon employees returning to work. The unemployment rate remained at 9.1% for the third straight month. The Department of Labor revised the July and August jobs reports to include a cumulative 99,000 new hires.1
ONE ISM INDEx rises, another RETREATS
The start of the month brings fresh PMIs from the Institute for Supply Management. ISM’s service sector index lost 0.3 points between August and September, but the reading for last month came in at a decent 53.0. Its manufacturing index rose a full percentage point in September to 51.6.2
AUTO Sales PICK UP
September’s Commerce Department report showed big demand for domestic car brands: Ford sales rose 9%, GM sales 20% and Chrysler sales 27%. Overall U.S. auto sales were 9.9% improved from September 2010.3
RATES ON 30-YEAR FRMs DIP BELOW 4%
Those who can qualify for a refi or want to chance buying will find the lowest home loan rates on record right now. Freddie Mac’s October 6 Primary Mortgage Market Survey reported an average interest rate of 3.94% for conventional 30-year home loans and 3.26% for 15-year fixed-rate mortgages.4
OVERSEAS DECISIONS HELP STOCKS REBOUND
Last week, the European Central Bank announced it would address the EU debt crisis with year-long loans and covered bond purchases. That news and some mildly positive stateside indicators sent stocks higher. Last week’s performances: S&P 500, +2.1% to 1,155.46; DJIA, +1.7% to 11,103.12; NASDAQ, +2.7% to 2,479.35.5,6
THIS WEEK: Earnings season officially begins. Monday is Columbus Day; banks are closed, markets are open. Tuesday, Alcoa kicks things off; we also have interim earnings from Chevron and the latest FOMC minutes. Wednesday brings 3Q results from PepsiCo. Thursday, we get earnings from Google, JPMorgan Chase and Safeway and new initial claims figures. On Friday, the G20 finance ministers meet in Paris and the initial October University of Michigan consumer sentiment survey comes out, along with Commerce Department reports on business inventories and retail sales; Mattel releases earnings, and the new iPhone is for sale.
% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA -4.10 +1.41 -1.26 +2.24
NASDAQ -6.54 +4.01 +1.56 +5.44
S&P 500 -8.12 -0.22 -2.88 +0.88
REAL YIELD 10/7 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.16% 0.48% 2.37% 3.50%
Sources: usatoday.com, online.wsj.com, bigcharts.com, treasury.gov, treasurydirect.gov – 10/7/115,6,7,8
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends
WEEKLY TIP
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WEEKLY RIDDLE
Just two U.S. states have capital cities whose names include the full name of the state. What states are they?
Last week’s riddle:
A rain gauge collects rainfall each day of a wet week beginning on Monday. Every day, the amount of rain in the gauge doubles. At Sunday’s end, the rain gauge is completely filled. So on which day is it half-filled?
Last week’s answer:
Saturday. The rain gauge is half-full on Saturday and the amount of rain in it doubles on Sunday so it becomes completely full.
Citations.
1 – marketwatch.com/story/september-data-show-improvement-in-jobs-market-2011-10-07 [10/7/11]
2 – ism.ws/ISMReport/NonMfgROB.cfm [10/5/11]
3 – reuters.com/article/2011/10/03/autos-sales-idUSN1E7920NK20111003 [10/3/11]
4 – businessweek.com/ap/financialnews/D9Q717681.htm [10/6/11]
5 – usatoday.com/money/index [10/7/11]
6 – online.wsj.com/article/SB10001424052970203388804576616440244686706.html [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F7%2F10&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F7F2%2F10&x=10&y=18 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F7%2F10&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F6%2F06&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F6%2F06&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F6%2F06&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F8%2F01&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F8%2F01&x=0&y=0 [10/7/11]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F8%2F01&x=0&y=0 [10/7/11]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [10/7/11]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [10/7/11]
9 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm71101.pdf [7/11/01]
10 – montoyaregistry.com/Financial-Market.aspx?financial-market=an-introduction-to-the-stock-market&category=29 [10/7/11]
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 Stonecreek Wealth Advisors, Inc. a fee only registered investment advisor firm in Salt Lake City, Utah, providing wealth management services. Mark Lund is the author of The Effective Investor.
