September 12th – Weekly Update

  • Interest rate speculation, once again, dominated investor sentiment with key U.S. equity indexes concluding the period lower. The Dow Jones, Nasdaq and S&P 500 all posted losses during a holiday- shortened week. International markets also expressed ripples of concern around the next U.S. Federal Reserve (Fed) interest rate hike with the Global Dow and the Euro 600 index both finishing the period lower. The U.K. FTSE 100 was also down. Oil and gold both gained during the period. The U.S. ten- year Treasury note yield rose to approximately 1.67%.
  • U.S. Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) data expressed underlying economic growth, with a July 2016 total jobs openings of 5.9 million. Initial jobless claims also decreased in early September to the lowest number since July, however, U.S. business activity showed an ease in momentum. The Markit U.S. Services purchasing manager’s index (PMI) came in at 51.0, slightly below its July reading of 51.4.
  • The European Central Bank declined to pledge additional stimulus or modify its asset-purchase plan, further contributing to international market volatility. Flat European consumer price index (CPI) data were not surprising in either their quarter-over-quarter or year-to-year measurements. 2Q16 over 2Q15 actual, consensus and previous numbers came in at 0.3%, they were 1.6% year to year in the same three areas.
  • U.K. housing prices from June – August 2016 were 0.7% higher than the preceding three months, reflecting the continuation of slight but steady economic growth in light of June’s Brexit vote. The U.K. RICS housing price balance, which reflects a population that experiences a rise in house prices, was up to 12% in August, a significant increase following its July plunge to 5%. U.K. industrial production rose 2.1% in July, year over year, while manufacturing production grew 0.8% during the same period.
  • In China, yearly CPI (as measured in August) grew 1.3%. Imports in China rose 1.5% during the same period while exports were down -2.8%. Asian markets dipped at the end of the week following geopolitical tensions regarding the latest North Korean nuclear test.

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