Recently, economists have worried about a decline in household spending. The 0.8% fall for retail sales in January affirmed their anxieties. Consumers have certainly been buying less fuel, but even with gas purchases removed, there was still an 0.2% retreat. Headline retail sales have now sunk for consecutive months; earlier Commerce Department data showed an 0.9% falloff in December.1
HOUSEHOLD SENTIMENT INDEX DECLINES
Did the rough weather blasting much of the nation affect the reading of the latest University of Michigan consumer sentiment index? Quite possibly. The final January edition came in at an 11-year high of 98.1, but February’s initial edition fell to 93.6 – and per region, the major declines came in the Midwest and Northeast.1
OIL ENDS THE WEEK WITH A RALLY
Rising 3.1% in a day, WTI crude settled at $52.78 a barrel on the NYMEX Friday. Over on the COMEX, silver rose 3.6% on the week to $17.29 while gold slipped 0.6% across five days to $18.104.22.168
S&P 500 CLOSES AT A NEW RECORD HIGH
Thanks to a 2.02% weekly ascent, the index settled at 2,096.99 Friday. Rising crude prices and signs of economic improvement in the euro area helped. Those factors also assisted the Dow and Nasdaq: the former gained 1.09% on the week, the latter 3.15%. Friday brought a close of 4,893.84 for the Nasdaq, 18,019.35 for the Dow.3
THIS WEEK: U.S. stock and bond markets are closed Monday for Presidents’ Day, but eyes will be on Europe as Greece formally asks to renegotiate its bailout. On Tuesday, earnings roll in from MGM Resorts, Goodyear, Medtronic, Waste Management, Norwegian Cruise Line, Agilent, Fossil, Jack in the Box, and Bridgestone. Wednesday, Wall Street looks at the minutes from the January Federal Reserve policy meeting, the latest Producer Price Index, data on January industrial output, building permits and housing starts and earnings from Fluor, Duke Energy,, Hilton, Avis Budget Group, SolarCity, Virgin America, Hyatt Hotels, Marathon Oil, Healthstream, Denny’s, Barrick Gold, Marriott and Garmin. The Conference Board’s January index of leading indicators arrives Thursday, plus a new initial claims report, earnings from Nestle, Wal-Mart, Priceline, Hormel, DirecTV, Boise Cascade, Clear Channel, Novatel, Noble Energy, Six Flags Entertainment, Newmont Mining, Public Storage and Nordstrom … and for the first time ever, minutes from a European Central Bank meeting (January 22). Friday sees earnings from Choice Hotels and Deere.
|% CHANGE||Y-T-D||1-YR CHG||5-YR AVG||10-YR AVG|
|REAL YIELD||2/13 RATE||1 YR AGO||5 YRS AGO||10 YRS AGO|
|10 YR TIPS||0.34%||0.56%||1.46%||1.54%|
Sources: online.wsj.com, bigcharts.com, treasury.gov – 2/13/154,5,6,7
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.
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1 – tinyurl.com/pfjbxc4 [2/13/15]
2 – proactiveinvestors.com/companies/news/59878/gold-gains-05-to-1227-wti-rises-31-to-5278-59878.html [2/13/15]
3 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [2/13/15]
4 – markets.wsj.com/us [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F13%2F14&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F13%2F14&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F13%2F14&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F12%2F10&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F12%2F10&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F12%2F10&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=2%2F14%2F05&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=2%2F14%2F05&x=0&y=0 [2/13/15]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=2%2F14%2F05&x=0&y=0 [2/13/15]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [2/13/15]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [2/13/15]