The Markets
Now you see it, now you don't: Domestic equities chugged upward until midweek, only to give back the entire week's gains plus a little bit more after reports showed manufacturing and employment at a standstill in August. Treasuries continued to benefit from equities' difficulties, with yields reversing the previous week's bounce. Gold rebounded from the losses of the week before, while oil prices turned up toward $90 a barrel once again.
Last Week's Headlines
The unemployment rate remained stalled at 9.1% in August. The Bureau of Labor Statistics said no net new jobs were added to the nation's payrolls. Health-care employment continued to rise, while governmental bodies continued to shed workers.
Consumers spent more on air conditioning and autos in July, helping to drive personal spending levels up 0.8% for the month, according to the Commerce Department.
However, incomes rose 0.3%, only slightly more than the previous month's anemic 0.2%, and when adjusted for inflation, real disposable incomes actually decreased by 0.1%.
Home prices were up 1.1% in June in the 20 cities tracked by the S&P/Case-Shiller index. Though prices are still down 4.5% from last June, the increase in prices during the year's second quarter was 3.6%, and 19 of the 20 cities saw increases in June.
Manufacturing in the United States continued to grow in August, but just barely. The Institute for Supply Management's index of the sector stood at 50.6, only slightly above the threshold that separates expansion from contraction. New orders and production measures actually contracted slightly, with 10 of the 18 industries covered showing growth.
Eye on the Week Ahead
The holiday-shortened week will be light on economic data, so investors will be free to focus on fundamentals. President Obama's proposals for jump-starting job creation will be evaluated for their prospects and potential impact on markets, and response to a Greek bond offering may provide clues to the debt situation there.
Key dates and data releases: U.S. services sector (9/6); international trade, weekly new jobless claims (9/8).
Data source: Includes data provided by Brounes & Associates. All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. Equities data reflect price change, not total return.
The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indexes listed are unmanaged and are not available for direct investment.
