October 3rd – Weekly Update

  • U.S. equity indexes recovered after a Monday dive to finish relatively flat for the week, with the S&P 500, Nasdaq and Dow all slightly up. Global market volatility during the period was largely correlated with political uncertainty in the U.S. and increasing animosity in Brexit-related headlines. The FTSE 100 and Global Dow index both experienced moderate losses. Oil rose during the period as OPEC preliminarily agreed to cut production. Gold was slightly down while investors continue to grapple with European banking concerns and Federal Reserve policy. The 10-year U.S. Treasury note yield ended the week at approximately 1.6%.
  • In a week spent adjusting to the recent Fed announcement to hold rates at least until December, positive U.S. economic data supported equites achieving a small gain for the period. The Conference Board Consumer Confidence Index increased to 104.1 in September, up from 101.8 in August. According to the report, going forward, “… consumers are more upbeat about the short- term employment outlook, but somewhat neutral about business conditions and income prospects.” The U.S. consumer price index (CPI) increased 0.2% in August.
  • The U.S. housing market exhibited strength during July with new U.S. single-family home sales reaching a close-to-nine-year high – July was the fifth straight gain. However, pending home sales for August fell 2.4%, worse than the consensus for a 0.3% increase. This is the lowest level since January and third time in four months that sales have fallen.
  • U.S. consumer spending increased a flat 0.2% in August. Unemployment claims rose for the week ended September 24, with an additional 3,000 filings resulting in a weekly total of 254,000. However, the four-week average showed improvement at 256,000.
  • The Euro Area Business Climate Indicator inched up to 0.45 in September from 0.03 in August. Euro Area consumer confidence increased to -8.2 in September from August’s -8.5. Unemployment concerns in the area continue to impact broad economic outlook views. Euro zone unemployment stood at 10.1% in August. The September euro zone CPI was 0.4%, rising 0.2% in comparison to August.

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