Weekly Economic Update 4/4/2016

Here is a PDF of Weekly Economic Update 4-4-2016.

ANOTHER SOLID JOBS REPORT

The latest Labor Department employment report shows net job gains of 215,000 for March. Labor force participation increased last month, and the jobless rate consequently ticked up to 5.0% (the broader U-6 rate edged up to 9.8%). Mean hourly wages rose 7 cents to $25.43, up 2.3% year-over-year. Payrolls expanded by an average of 209,000 hires per month during the first quarter.1

MANUFACTURING SECTOR GROWS

Rising to a March reading of 51.8, the Institute for Supply Management’s manufacturing PMI indicated sector expansion once again. In February, the index was in contraction territory at 49.5.2

SMALL GAINS IN CONSUMER CONFIDENCE, SPENDING

March saw the Conference Board’s consumer confidence index improve 2.2 points to 96.2. The University of Michigan’s consumer sentiment index finished the month at 91.0, above the initial March reading of 90.0. A new Commerce Department report showed an 0.1% gain in personal spending in February.2

GOOD NEWS IN HOUSING

Pending home sales were up 3.5% in February, said the National Association of Realtors. That offset their 3.0% January retreat. The January edition of the S&P/Case-Shiller home price index measured a healthy 5.7% yearly gain for U.S. home values across 20 cities.2

NASDAQ RISES NEARLY 3% IN A WEEK

Factory gains and the new Labor Department jobs report gave stocks a tailwind as March ebbed into April. Last week, the Nasdaq Composite outpaced the S&P 500 and Dow Jones Industrial Average: the tech-heavy benchmark gained 2.95% across five days to 4,914.54. In the same interval, the S&P improved 1.81% to 2,072.78 while the Dow rose 1.58% to 17,792.75.3

THIS WEEK: Nothing major is scheduled for Monday. Tuesday, Wall Street looks at ISM’s March service sector PMI and earnings from Darden Restaurants and Walgreens Boots Alliance. Wednesday, Federal Reserve March policy meeting minutes complement earnings from Bed Bath & Beyond, Constellation Brands, and Monsanto. Thursday offers a new initial claims report and earnings from CarMax, ConAgra Foods, Rite Aid, Ruby Tuesday, and WD-40. No major news items are slated for Friday.

 

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +2.11 +0.53 +8.75 +6.02
NASDAQ -1.85 +0.70 +15.23 +11.00
S&P 500 +1.41 +0.64 +11.11 +6.01
REAL YIELD 4/1 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.17% 0.07% 0.94% 2.35%

Sources: wsj.com, bigcharts.com, treasury.gov – 4/1/164,5,6,7

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.

WEEKLY QUOTE

“Honesty is the best image.”

     – Tom Wilson

WEEKLY TIP

Young adults nearing college graduation may find that an emergency fund is a nice thing to have. Your son or daughter might want to try and save at least $1,000 before leaving campus.

WEEKLY RIDDLE

You have 7 onions in a bag, and you will distribute them to 7 people. As you finish handing them out, there is still 1 onion left in the bag. How is this possible?

Last week’s riddle:

You put me on a table. You cut me, yet you will not eat me. What am I?

Last week’s answer:

A deck of cards.

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This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Citations.

1 – forbes.com/sites/samanthasharf/2016/04/01/jobs-report-215000-jobs-added-in-march-unemployment-rate-higher-at-5 [4/1/16]

2 – investing.com/economic-calendar/ [4/1/16]

3 – markets.on.nytimes.com/research/markets/usmarkets/usmarkets.asp [4/1/16]

4 – markets.wsj.com/us [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F1%2F15&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F1%2F15&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F1%2F15&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F1%2F11&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F1%2F11&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F1%2F11&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F31%2F06&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F31%2F06&x=0&y=0 [4/1/16]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F31%2F06&x=0&y=0 [4/1/16]

6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [4/1/16]

7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [4/1/16]

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