The Markets
The record-breaking march of the stock market faltered last week, as all
indices posted losses. Perhaps the setback was due to a lack of
economic influences, or because investors were nervously anticipating
the results of next week's Federal Open Market Committee (Fed) meeting,
wondering whether Chair Janet Yellen will indicate a leaning toward
higher rates. Or perhaps, as some observers believe, it was just time
for a mild adjustment. Yields on the 10-year Treasury jumped to their
highest point since early July.
Last Week's Headlines
- Job openings remained near a 13-year high in July 2014, according
to the Bureau of Labor Statistics (BLS). At 4.7 million, the number of
open jobs changed very little from a month earlier. The hire rate (3.5%)
held steady from June. The number of hires inched upward to
approximately 4.9 million in July from nearly 4.8 million in June,
reaching the highest level since December 2007.
- In a prime-time address to the nation Wednesday night, President
Obama announced an expanded effort to "degrade, and ultimately destroy"
the Islamic State of Iraq and Greater Syria, or ISIS. Details included
expanding airstrikes in Iraq, introducing airstrikes in Syria, and
sending additional troops to Iraq for training and advisory missions.
- The Commerce Department reported that sales by wholesalers rose
0.7% from June to July, and were up 7.5% from a year earlier.
Inventories inched up 0.1% from June, and were up 7.9% from a year
earlier.
- Consumers shopped at their strongest rate since April, also
according to the Commerce Department. Retail sales rose 0.6% from July
to August, to a total $444.4 billion. Sales were 5% higher than one year
ago.
- The United States joined the European Union in imposing further
sanctions on Russia Friday, with impacts on Russian interests in the
energy, banking, and defense sectors.
Eye on the Week Ahead
This week promises to make up for last week's trickle of economic
data. Investors will have an eye on industrial production; inflation,
manufacturing, and housing data; international capital flows;
Wednesday's Fed meeting; leading economic indicators; and any changes in
trading volume due to this quarter's quadruple witching options
expiration at the end of the week.
Data sources: Economic: Based on
data from U.S. Bureau of Labor Statistics (unemployment, inflation);
U.S. Department of Commerce (GDP, corporate profits, retail sales,
housing); S&P/Case-Shiller 20-City Composite Index (home prices);
Institute for Supply Management (manufacturing/services). Performance:
Based on data reported in WSJ Market Data Center (indexes); U.S.
Treasury (Treasury yields); U.S. Energy Information
Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing,
OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency
exchange rates). 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. All investing involves risk, including the potential
loss of principal, and there can be no guarantee that any investing
strategy will be successful.
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 2,000 U.S. small-cap common stocks. The Global Dow is an equally
weighted index of 150 widely traded blue-chip common stocks worldwide.
Market indices listed are unmanaged and are not available for direct
investment.
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