Weekly Economic Update for September 2, 2013

Weekly Economic Update for September 2, 2013

September 2, 2013    

Q2 GDP REVISED UP, CONSUMERS SPEND A BIT MORE

Personal spending and personal incomes each rose 0.1% in July, the Commerce Department stated Friday. The tiny household spending advance fell short of the 0.3% increase forecast by economists polled by Bloomberg. In better news, the Commerce Department adjusted its estimate of Q2 GDP to 2.5% last week, much better than its original 1.7% assessment.1,2

A MIXED PICTURE OF CONSUMER CONFIDENCE

The Conference Board’s August consumer confidence index unexpectedly rose half a point to 81.5 this month (although the survey data was compiled prior to the chemical attack against civilians in Syria). In contrast, the final August consumer sentiment index from the University of Michigan came in at 82.1, a 4-month low.1,2

PENDING HOME SALES, HOME PRICE GAINS MODERATE

July saw a 1.3% decline in housing contract activity, according to the National Association of Realtors. The June edition of the S&P/Case-Shiller Home Price Index recorded a 12.1% overall annualized increase in home values and a 0.9% overall monthly rise in prices (the smallest monthly gain since November).2,3

HARD GOODS ORDERS DIP 7.3% FOR JULY

Economists did not see this coming. The Commerce Department announced the biggest one-month descent in the indicator in a year last week, with core durables (minus defense and airplane orders) slipping 3.3%.4

GOLD & OIL PRICES SURGE, STOCKS SLIP

With U.S. military intervention in Syria appearing close at hand, NYMEX crude ended the week up at $107.65, going +2.24% for August. Gold settled at $1,396.10 Friday; it entered a bull market once again, rising 5.26% on the month. Stocks declined: the Dow went -1.33% on the week to close at 14,810.31 Friday, and the NASDAQ (-1.86% to 3,589.87) and S&P 500 (-1.84% to 1,632.97) followed suit.5,6

THIS WEEK: Monday is Labor Day; U.S. financial markets are closed. The August ISM manufacturing index comes out Tuesday, as well as earnings from H&R Block. Wednesday sees the release of a new Federal Reserve Beige Book and Q2 results from Dollar General. Thursday brings the latest round of initial jobless claims, a new ADP employment report and Challenger job-cut report, the July factory orders report and the ISM non-manufacturing index for August; a two-day G20 summit also begins. Friday, the Labor Department issues unemployment figures for August and Smithfield Foods and Mattress Firm announce earnings.

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +13.02 +13.92 +5.66 +5.73
NASDAQ +18.89 +17.75 +10.33 +9.83
S&P 500 +14.50 +16.68 +5.46 +6.20
REAL YIELD 8/30 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.68% -0.63% 1.68% 2.29%

Sources: cnbc.com, bigcharts.com, treasury.gov – 8/30/136,7,8,9

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends.

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. 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. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. 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.

Citations.

1 – bloomberg.com/news/2013-08-30/consumer-spending-in-u-s-increased-in-july-for-a-third-month.html [8/30/13]

2 – bloomberg.com/news/2013-08-29/consumer-comfort-in-u-s-declines-to-a-more-than-four-month-low.html [8/29/13]

3 – usatoday.com/story/money/business/2013/08/27/case-shiller-index-june/2705137/ [8/27/13]

4 – online.wsj.com/article/BT-CO-20130826-706196.html [8/26/13]

5 – money.cnn.com/data/commodities/ [8/30/13]

6 – tinyurl.com/p4put9e [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F30%2F12&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F30%2F12&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F30%2F12&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F29%2F08&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F29%2F08&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F29%2F08&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F29%2F03&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F29%2F03&x=0&y=0 [8/30/13]

7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F29%2F03&x=0&y=0 [8/30/13]

8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [8/30/13]

9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [8/30/13]

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