Weekly Economic Update 9/4/2017


The Department of Labor’s latest employment snapshot shows payrolls expanding by 156,000 net new jobs in August. This was a retreat from the job gains of 200,000+ reported in both June and July. The headline jobless rate ticked up to 4.4%; the U-6 rate, which factors in the underemployed, held steady at 8.6%. Annualized wage growth remained stuck at 2.5%.1


Climbing once again, the Conference Board’s consumer confidence index ascended 2.9 points to 122.9 in August. That topped the forecast of economists surveyed by MarketWatch, who anticipated a 122.5 reading. Additionally, the Department of Commerce said that consumer spending advanced 0.3% in July, up from 0.2% in June. Household incomes rose 0.4% in July; they were unchanged in June.2   


Can the Institute for Supply Management’s manufacturing purchasing manager index top 60 soon? It rose 2.5 points to 58.8 in August, indicating a high degree of expansion. This was the best reading on the index since April 2011. So far in 2017, the factory PMI has averaged a reading of 56.7.3


All three major U.S. stock benchmarks gained ground last week. Out in front was the Nasdaq Composite, which added 2.71% in five days to settle at 6,435.33 Friday. The S&P 500 rose 1.37% for the week, closing September 1 at 2,476.55. As for the Dow Jones Industrial Average, it moved north 0.80% to 21,987.56. The CBOE VIX dropped 10.02% in five days to 10.15 at Friday’s closing bell. One last detail worth noting: the NYSE Arca Biotech index jumped 8.98% last week to go up 37.65% on the year.4    

THIS WEEK: Wall Street is closed Monday for the Labor Day holiday. Investors consider earnings from Casey’s General Stores, Hewlett Packard Enterprise, and the Hudson’s Bay Company on Tuesday, plus a report on July factory orders. A new Federal Reserve Beige Book and the August ISM service sector PMI arrive Wednesday, along with earnings releases from Fred’s and Navistar. Thursday, earnings arrive from Barnes & Noble, Dell Technologies, Hovnanian Enterprises, and Verifone, and a new initial unemployment claims report surfaces. On Friday, Kroger reports quarterly results.  

DJIA +11.26 +19.37 +13.59 +6.46
NASDAQ +19.55 +23.11 +21.97 +14.79
S&P 500 +10.62 +14.08 +15.21 +6.80
10 YR TIPS 0.37% 0.12% -0.68% 2.34%

Sources: wsj.com, bigcharts.com, treasury.gov – 9/1/174,5,6,7

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              

“Courage is doing what you’re afraid to do. There can be no courage unless you’re scared.”     

– Eddie Rickenbacker         

WEEKLY TIP             

Has your emergency fund or checking account taken a hit lately? Consider setting up a monthly automatic transfer to help you replenish it.       

WEEKLY RIDDLE            

What has a neck, yet no head?     

Last week’s riddle:

Jon drove past the college where he was enrolled at 60mph, but he wasn’t pulled over or cited, even though a police officer was right behind him. Why?           

Last week’s answer:

He was driving on a highway with a speed limit above 60mph.

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1 – foxbusiness.com/markets/2017/09/01/us-hiring-cools-off-with-156000-new-jobs-in-august.html [9/1/17]

2 – marketwatch.com/economy-politics/calendars/economic [9/1/17]

3 – instituteforsupplymanagement.org/ISMReport/MfgROB.cfm [9/1/17]

4 – markets.wsj.com/us [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=9%2F1%2F16&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=9%2F1%2F16&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=9%2F1%2F16&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F31%2F12&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F31%2F12&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F31%2F12&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F31%2F07&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F31%2F07&x=0&y=0 [9/1/17]

5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F31%2F07&x=0&y=0 [9/1/17]

6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [9/1/17]

7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [9/1/17]

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