Major stock indices were mixed for the week with the small cap Russell 2000 and developed international stocks lower and the biggest gains in emerging markets.  The strong jobs number in September buoyed markets on Friday but raised questions on the number and size of future FED rate cuts.  Other economic data indicated a slowing economy.

Treasury bond yields rose with the 30-year bond yield at 4.259% and the 10-Year note at 3.972%.  Freddie Mac reported that the average 30-year mortgage rate rose to 6.12%.  Crude oil rose to $75.28 a barrel and natural gas rose to $2.921 per MMBTUs.  The U.S. dollar index rose to 102.58 and gold fell to $2668.70 an ounce.

In economic reports this week:

• S&P Global released its purchasing manager’s indices for September.  Remember anything over 50 represents expansion and anything under 50 represents contraction.
  • U.S. manufacturing PMI fell from 47.9 to 47.3.
  • U.S. services PMI fell from 55.7 to 55.2.
  • China manufacturing PMI fell from 50.4 to 49.3.
  • China services PMI fell from 51.6 to 50.3.
  • Japan manufacturing PMI fell from 49.8 to 49.7.
  • Japan services PMI fell from 53.7 to 53.1.
  • Eurozone manufacturing PMI fell from 45.8 to 45.0.
  • Eurozone services PMI fell from 52.9 to 51.4.
  • Canada manufacturing PMI rose from 49.5 to 50.4.
  • Canada services PMI fell from 47.8 to 46.4.
  • Mexico manufacturing PMI fell from 48.5 to 47.3.
• The Commerce Department reported:
  • Construction spending fell 0.1% in August after falling 0.5% in July.

• • Factory order fell 0.2% in August.

• Marklines reported that auto sales in September were down 12.3% from last September.
  • Passenger car sales were down 18.0%.
  • Pickup truck and SUV sales were down 10.9%.
  • Year to date passenger car sales were down 5.8%.
  • YTD pickup truck and SUV sales were up 2.3%
• The Labor department reported:
  • Reported little change in job openings, hire and separations in August. 
    • Job quits fell to 1.9% of the workforce, down from 2.3% last August.
    • The number of unemployed persons per job opening was unchanged in August at 0.9 but is up from 0.7 in August 2023.
• • The U.S. added 254,000 jobs in September beating expectations.
    • Unemployment fell from 4.2% to 4.1%.
    • The labor force participation rate remained at 62.7%.
    • Average hourly earnings rose 0.4% in September and are up 4.0% from a year ago.
  • Seasonally adjusted first-time claims for unemployment were 225,000, an increase of 6,000 from the previous week’s revised level.
    • The 4-week moving average of claims, designed to smooth out volatility, was 224,250, a decrease of 750 from the previous week’s revised level. 
    • For the full unemployment report go here:  https://www.dol.gov/ui/data.pdf .
• 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 rose from 13.2MM BPD to 13.3MM BPD.
  • Natural gas storage rose 55BN 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 fell 5 to 479 and the number of natural gas rigs rose 3 to 105.

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

https://bakerhughesrigcount.gcs-web.com/na-rig-count

https://www.census.gov/economic-indicators

https://www.pmi.spglobal.com/Public/Release/PressReleases

https://www.bls.gov/jlt/