US Stocks ended the week with slight gains. Fed Reserve minutes from the September meeting were released shedding light on the internal debate about the timing of interest rate increases. Fed Vice Chair Stanley Fischer said that the FED is very close to its goals for jobs and inflation. This was bolstered by a firming consumer price index. Crude oil prices hit a 50 week high before easing by weeks’ end. Ironically 10-year Treasury yields fell from 1.8% to 1.75%. Overall, commodity prices were nearly unchanged. The dollar, however, rose against a basket of currencies in anticipation of a December rate hike.
In the numbers this week:
- The Federal Reserve reported that U.S. Industrial Production rose 0.1% in September.
- Factory production rose 0.2% mainly in consumer goods and industrial production.
- Mining production rose 0.4% mainly due to increased oil and gas drilling.
- Utility production dropped 1%.
- Capacity utilization rose from 75.3% to 75.4%
- The Labor Department reported
- The consumer-price index, rose 0.3% in September. From a year ago the price index rose 1.5%. Excluding volatile food and energy, core prices rose 0.1%. From a year ago core prices rose 2.2%.
- First time claims for unemployment rose 13,000 in the prior week to 260,000. The previous week’s claims were revised up by 1,000 to 247,000. The four week moving average of claims rose 2,250 to 251,750. First time claims have remained below 300,000 for 85 weeks the longest stretch since 1970. At that time the population and workforce were much smaller.
- The Commerce Department reported that housing starts fell 9% in September. This is the second month of declines and was largely due to a drop in multi-family starts. Conversely, building permits, an indicator of future starts, rose 6.3%.
- The Energy Information Administration reported:
- Crude oil Imports fell 954,000 barrels per day to 6.9MM barrels per day.
- Crude oil Inventories fell 5.2MM barrels.
- Crude oil production rose 16,000 barrels.
- Gasoline inventories increased 2.5MM barrels.
- The National Association of Realtors reported
- Sales of existing homes rose a seasonally adjusted 3.2% in September.
- The median price of homes sold was $234,200, up 5.6% from last year.
- Baker Hughes reported that in the last week the number of oil rigs increased 11 to 443 while the number of gas rigs rose 3 to 108.
- Factset reported that with 23% of S&P 500 earnings reporting that the blended earnings of these companies have declined 0.3%. The estimate of earnings decline was 2.0% prior to the start of earnings releases. The biggest upside surprise in earnings has come from the Financials sector.
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Loren C. Rex, CFP®, AIF® Erik Smith
Generations Financial Planning & Wealth Management 269-441-4143
77 E. Michigan Ave, Suite 140
Battle Creek, MI 49017
Carrie Fuce, Assistant 269-441-4091
Toll Free: 800-513-8180
Visit our Website: www.genfinplan.com
Registered Representative of and securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Generations Financial Planning & Wealth Management are separate companies and are not affiliated.
These are the opinions of Loren Rex and Erik Smith and are not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice.