December 12th – Weekly Update

  • After pausing last week, U.S. equity markets again resumed their post-election rally. Three of four major indexes closed at fresh all-time highs during the period – oil surged on a weekend OPEC deal that sent crude oil to nearly $57.
  • The S&P 500, Dow Jones and Nasdaq all posted gains – gold finished slightly down. The 10-year U.S. Treasury note yield ended the week slightly higher at approximately 2.47%.
  • A Wall Street Journal survey of economists found expectations for the Fed to pick up the pace of interest rate hikes in the coming year. Respondents see the fed fund rate at 1.26%, on average, by December 2017. This implies four rate hikes from the current level, including one at the December 14 meeting.
  • The European Central Bank announced that it will extend its quantitative easing program beyond March 2017. The ECB also said that the program could be extended beyond 2017 if necessary.
  • The preliminary December reading for the University of Michigan Consumer Sentiment index came in at 98.0, only one tenth of a point lower than the recent peak in January 2015, which was the highest level for the index since 2004. Both current and expected conditions components posted a strong rise.
  • The U.S. job market was flat in October compared to the previous month. 5.5 million job openings came available during the month, compared to 5.6 million in September. Initial jobless claims for the latest week fell 10K to 258K, slightly below the 260K consensus estimate.
  • Euro zone investor confidence dipped in December to 10.0 from November’s 13.1. However, during October, euro zone retail sales grew at the most impressive rate in over two years, climbing 1.1 percent from September to October. November inflation for the euro zone measured at a dismal 0.6 percent.
  • U.K. industrial production dropped 1.1 percent year-over-year as of October 2016. Industrial production gained 0.4 percent in October compared to September.
  • Following a 7.3 percent drop in September, China exports grew for the first time this year since March, rising 0.1 percent in November compared to November 2015. China imports rose 6.7 percent in November following a 1.4 percent fall in October.

CPWM Investment Dashboard (2016.12.12)