While the declines lasted into Monday, stocks rose the remaining three days of this holiday shortened week with all major indices ending with substantial gains. The economic data came in mixed with strong housing numbers but weak inflation adjusted consumer spending and income.
Treasury yields rose with the 30-year bond yield closing at 1.908% and the 10-Year note closing at 1.495%. Crude oil rose to $73.76 a barrel and natural gas rose to $3.733 per MMBTUs. The U.S. dollar index fell to 96.06 and gold rose to $1810.10 an ounce.
In the economic numbers:
- The National Association of Realtors reported:
- Existing home sales rose 1.9% in the month of November but are down 2.0% from a year earlier.
- The median price for an existing home has risen 13.9% from a year ago to $353,900.
- The Commerce Department reported the following for November:
- Consumer spending rose 0.6% in the month of November following a 1.4% increase in October. The slower pace of growth was attributed to earlier Christmas shopping.
- After adjusting for inflation, consumer spending was up less than 0.1%.
- The Personal Consumption Price index or PCE rose 5.7% from a year ago and was up 0.6% in November.
- Core prices, excluding food and energy rose 4.7%.
- The PCE price index is the FED’s preferred measure of inflation.
- Personal income rose 0.4% in November but after inflation fell 0.2%.
- New home sales (both pre and post construction) rose 12.4% in November while the median price for a new home rose to $416,900. However from a year ago, new home sales are down 14% due to tight supply chains and costs.
- Consumer prices in Japan rose 0.6% from a year earlier. Core prices rose 0.4%.
- The Labor Department reported :
- First time claims for unemployment were 205,000 unchanged from the prior week’s revised number.
- The 4-week moving average of claims, designed to smooth out volatility, rose to 206,250.
- Continuing claims were little changed at 2.0MM.
- 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 11.7MM BPD to 1.6MM BPD.
- Natural gas storage fell 5BN cubic feet and is about at 5-year average at this time of year.
- Baker Hughes reported the number of active oil rigs rose 5 to 480. The number of active natural gas rigs rose 2 to 106.
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Loren C. Rex, CFP®, MA Erik A Smith, AIF®
Founder / Emeritus President & C.E.O.
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. The Indices mentioned are unmanaged and cannot be invested into directly.