U.S. Stocks gained this week as did international stocks. The markets were buoyed by dovish comments from Janet Yellen indicating that the FED will be cautious about raising rates given global uncertainties. Treasury prices rose as yields fell. Commodity prices including oil were lower but gold and silver rose as the dollar fell. Oil was hurt by comments from Saudi Arabia that they will not agree to a production cap unless Iran and other major producers also agree to a cap. Stocks also reacted positively to another good month of jobs gains in March.
In economic news this week:
- The Commerce Department reported
- Consumer spending rose 0.1% in February. Taking into consideration falling prices, consumer spending rose 0.2%.
- Personal income rose 0.2%.
- The personal savings rate was 5.4% in February up from 5.3% in January and 5.0% in December.
- The personal consumption expenditures index, the FEDs preferred inflation measure, fell 0.1% in February. Excluding volatile food and energy, core prices rose 0.1% in February and 1.7% from a year ago.
- The National Association of Realtors reported that pending sales of existing homes rose 3.5% in February.
- The S&P Case Shiller Home Price Index rose 5.4% in January from a year ago, more than the 5.3% increase in December.
- The S. Energy Information Administrationreported that inventory of crude oil rose 2.3MM barrels in the prior week while inventories of gasoline and distillate fell by 3.6 million barrels. Part of the cause the rise in crude and the fall in gasoline was the shutdown of refineries switching to summer blends.
- The Labor Department reported
- Initial claims for unemployment rose 11,000 to a seasonally adjusted 276,000 in the prior week. This is the third week of increases. However, this is also the longest streak of claims numbers below 300,000 since 1973. The four week moving average of claims rose 3,500 to 263,250.
- The U.S. created 213,000 jobs in February, less than the 242,000 created in January. The unemployment rate rose from 4.9% to 5.0% as more people re-entered the workforce.
- Average hourly wages increased 7 cents to $25.43, a 2.3% increase from a year ago.
- The Institute for Supply Management reported that U.S. Factory Activity rose to 51.8 in March from 49.5 in February. So we’ve seen a swing from contraction to expansion as the effects for lower oil prices and the strong dollar have faded.
- S. Auto sales rose 3.2% in March according to Kelly Blue Book, for the best March in 16 years.
Please call us if you have any questions.
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
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