Major stock indices were mixed for the week with a modest gain in the Dow 30 Industrials and the S&P 500 and modest losses in the Nasdaq 100, developed and emerging markets, and the Russell 2000 small caps. Economic data came in stronger with a pickup in durable goods orders, consumer spending and continued lower PCE price index.
Treasury bond yields rose with the 30-year bond yield at 4.163% and the 10-Year note at 3.877%. Freddie Mac reported that the average 30-year mortgage rate fell to 6.35%. Crude oil rose to $75.24 a barrel and natural gas fell to $2.047 per MMBTUs. The U.S. dollar index rose to 101.39 and gold rose to $2543.20 an ounce.
In economic reports this week:
- The S&P Global Case Shiller national home price index rose 0.47% in June and was up 5.42% from last June.
- The Commerce Department reported:
- Durable Goods Orders rose 9.9% in July after falling 6.9% in June.
- The drop in June and the rise in July was largely due to the cyber-attack affecting new car dealers in June.
- Excluding transportation, durable goods orders decreased 0.2%.
- Excluding defense, durable goods orders rose 10.4%.
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- The second estimate of 2nd quarter gross domestic product was revised up from 2.8% to 3.0% annual rate. The change was due to higher consumer spending than previously measured.
- Personal consumption expenditures rose 0.5% in July.
- The PCE price index rose 0.2% for the month. Adjusted for this inflation, expenditures rose 0.3%.
- Excluding volatile food and energy, prices also rose 0.2%.
- From a year ago, the PCE price index rose 2.5% and excluding food and energy rose 2.6%.
- The Labor department reported:
- Seasonally adjusted first-time claims for unemployment were 231,000, a decrease of 2,000 from the previous week’s revised level.
- The 4-week moving average of claims, designed to smooth out volatility, was 231,500, a decrease of 4750 from the previous week’s revised level.
- For the full unemployment report go here: https://www.dol.gov/ui/data.pdf .
- Seasonally adjusted first-time claims for unemployment were 231,000, a decrease of 2,000 from the previous week’s revised level.
- The EIA weekly oil report is here: http://ir.eia.gov/wpsr/wpsrsummary.pdf . Also, the EIA reported in the prior week:
- Field production of crude oil fell from 13.4MM BPD to 13.3MM BPD.
- Natural gas storage rose 35BN cubic feet and is above the average level during the past five years at this time of year.
- Baker Hughes reported the number of oil rigs was unchanged at 483 and the number of natural gas rigs fell 2 to 95.
Please call us if you have any questions.
Loren Rex – Emeritus
Erik A Smith, AIF® – President & C.E.O.
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. The Indices mentioned are unmanaged and cannot be invested into directly. The Dow Jones Industrial Average, Dow Jones, or simply the Dow, is a stock market index of 30 prominent companies listed on stock exchanges in the United States. The DJIA is one of the oldest and most commonly followed equity indexes. The Nasdaq Composite is a stock market index that includes almost all stocks listed on the Nasdaq stock exchange (more than 2500 stocks).
Sources:
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRFPUS2&f=W
https://ir.eia.gov/ngs/ngs.html
https://www.freddiemac.com/pmms
https://www.wsj.com/market-data?mod=nav_top_subsection
