Category: Weekly Updates

Weekly Updates

Financial News and Portfolio Management Discussion through June 8th

US Stocks posted their best week of the year on expectations of a Fed interest rate cut later this year.  The S&P 500 surged 4.4% and the Dow jumped 4.7% for the week.  Internationally, Japan rose 1.4% and Europe gained 2.3% for the week.  The yield on the 10-year Treasury fell to 2.09% its lowest level since September 2017.

US factory activity slowed in May posting its lowest reading since October 2016, short of expectations.

Comments from Fed Chair Powell showed that a cut from the current target of 2.25% to 2.5% of the Fed Funds rate was a possibility if trade policy negatively impacted the economy.

The World Bank reduced its global growth forecast from 2.9% to 2.6%.

The ECB said at the conclusion of their meeting they weren’t making any benchmark rate adjustments until at least the second half of 2020, and opened the door to a possible rate cut – a significant change in policy.

After expecting an increase of 180,000 jobs in May employers added just 75,000.   In addition, April and May’s rate of hiring was revised down.  The unemployment rate held at 3.6% and wage growth remained at 3.1%.

The US and Mexico reached a deal to avoid the implementation of tariffs threatened by President Trump.

Federal agencies are poised to investigate Facebook, Amazon and Google over possible anti-competitive practices.

Financial News and Portfolio Management Discussion through June 1st

Stocks posted their fourth straight week of declines driven by trade tensions.  The S&P 500 declined 2.6% and the Dow sank 3.0% for the week.  For the month both indices fell over 6.6%.  Abroad, Europe dropped 1.8% and Japan eased 2.4% for the week.  The yield on the 10-year Treasury ended the week and month at 2.14%.  It was the largest one-month yield decline since 2015 and the 10-year yield reached its lowest level since September 2017.  Yields on German bonds hit an all-time low.  Oil prices fell 16.3% in May to their lowest level in three months ending at $53.50 a barrel.

President Trump threatened 5% tariffs on all Mexican goods beginning June 10th and they would grow to 25% in October if the country doesn’t do more to stop the flow of immigrants into the US.

Home price growth rose 3.7% for the year ended in March, down from the prior month.

First quarter GDP growth was revised down slightly to 3.1% from 3.2%.

The personal consumption expenditures index, the Fed’s preferred gauge, rose 0.3% in April from March, its largest monthly gain since January. The move could provide support for the Fed’s thinking that the current soft patch for inflation will be short-lived.  However, the trailing year core index is up 1.6%, still well below the 2% target.

The Justice Dept. plans to begin an antitrust investigation into Google.

Financial News and Portfolio Management Discussion through May 25th

Stocks fell over the week as trade fears again weighed on stocks.  Th S&P 500 declined 1.2% and the Dow eased 0.7% for the week. Abroad, Europe and Japan % for the week.  The yield on the 10-year Treasury ended the week at 2.33% up slightly from its lowest level since 2017 that it had reached earlier in the week.  Oil fell 6.8% over the week to $58.63 a barrel on oversupply and global growth concerns.

Existing home sales fell 0.4% in April from March and 4.4% from a year earlier.  It was the 14th straight month of annual declines.  Home prices rose 3.6%.

Minutes from the Fed’s May meeting showed the central bank was comfortable with its wait and see approach.  They believed that the soft patch for inflation would be temporary.

New home sales fell 6.9% in April more than expected.

UK prime Minister May abruptly announced her resignation as she failed to reach an agreement to take the UK out of the EU.

Durable goods orders plunged 2.1% in April from March.

 

Financial News and Portfolio Management Discussion through May 18th

US Stocks fell for a second week on uncertainties over US and China trade negotiations.  The S&P 500 fell 2.2% and the Dow dropped 2.1% for the week.  Internationally, Japan plunged 4.1% and Europe sank 3.4% for the week.  The yield on the 10-year Treasury continued to trend down as investors added to safe haven positions.  The yield fell to 2.41%.

China retaliated against US tariffs with plans to increase tariffs on $60 billion of US goods and the US said it would plan to raise tariffs to 25% on $300 billion worth of Chinese goods this summer.

Trump signed an executive order that would ban telecommunications equipment from “foreign adversaries.”  The ban would directly impact China.

Retail sales fell 0.2% in April below expectations.

Factory output fell 0.5% in April, the third monthly decline in four months.

Data showed that retail sales, fixed asset investment and industrial production all cooled in China in April.

Germany grew at 0.4% in the first quarter.

The White House delayed a decision on auto parts and imported cars for 6 months.  The US also reached a deal with Canada and Mexico to exempt them from steel and aluminum tariffs.

Consumer sentiment in the US in May rose to the highest level since 2004.

 

Financial News and Portfolio Management Discussion through May 11th

Stocks posted their worst week of the year on fears a trade war between the US and China could be developing.  The S&P 500 fell 2.2% and the Dow dropped 2.1% for the week.  Internationally, Japan plunged 4.1% and Europe sank 3.4% for the week.  The yield on the 10-year Treasury fell over the week as investors flocked to safe haven assets.  The yield fell to 2.46%.

President Trump Tweeted on Sunday the 5th that trade negotiations with China were moving too slowly and said he would raise tariffs on $200 billion of Chinese goods to 25% on Friday from the current 10% level.  He also said he would impose levies of 25% on $325 billion of Chinses goods that have yet to be taxed.  Talks resumed Thursday and Friday and though the US said they were constructive they failed to reach an agreement.  The US moved forward with raising tariffs on $200 billion of Chinese goods to 25% from the current 10% level and China said it was considering counter measures.  The US also is set to move forward with the adding tariffs to the remaining Chinese goods that have not faced a levy.