Personal Income & Spending Report

IMPROVING ECONOMIC MOMENTUM

Stocks opened lower this morning on trade war concerns. The Dow is currently down 22 pts and the SPX is down .28%. Pharmaceuticals, transports, semiconductors and banks are all down. Real estate investment trusts (REITs) are up on the better than expected pending home sales report. The consumer staples sector is higher on a strong earnings report by Procter & Gamble (PG). European markets were uniformly and sharply lower in today’s session, whereas Asian markets traded higher overnight. Commodities are mostly higher, with WTI crude oil bouncing back toward $57.15/barrel. Bonds are mixed. Long-term Treasuries are up slightly, but corporates are down on the day. The iBoxx Investment Grade Corporate Bond ETF (LQD) is showing signs of topping out after 10% run this year. As we see more signs of improving economic momentum (see below) rates could move upward, pushing bond prices lower.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

GREEN SHOOTS FOR THE ECONOMY

Stocks opened pretty flat this morning, waiting for the flood of earnings announcements scheduled this week. Today, the Dow is flat and the SPX is up .2%. The financial sector jumped 1.3% in early trading in reaction to rising interest rates (see below). The communications services sector is up .6% on a pop in telecom stocks. On the other hand, utilities and REITs—which are sensitive to interest rates—are down .5% to .7% today. Commodities are trading mostly lower. Copper plunged more than 5%--a big move for one day. We’ve heard that Chinese authorities are pulling back on economic stimulus, believing they’ve succeeded in stabilizing their economy. WTI crude oil is flat at $63.30/barrel. Bonds are selling off, especially at the long end. The 10-year US Treasury yield backed up to 2.53%. But the big news on the interest rate front is a surprise steepening of the yield curve. You may recall I’ve flagged the flat yield curve as a potential problem for the market and economy. The difference between short-term and long-term interest rates has been very small, suggesting slowing economic growth. Specifically, the difference between the 2-year and 10-year Treasury yields has been in the range of just .10% to .20% for about five months now. But late last week the gap started to widen, breaking out of that range. This could be good news and it bears watching.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 29, 2018

November 29, 2018

The major stock market indices opened lower this morning following yesterday’s relief rally. At the moment, the Dow is down 62 points, and the SPX is down .2%. Energy, healthcare and materials are up about .5%, but most other sectors are falling back, led by the cyclicals (tech, financials, consumer discretionary). WTI crude oil is bouncing a bit; now trading up around $52/barrel. Gold is up slightly today, but most other commodities are trading lower. Treasury bonds are trading up as yields tick lower. But corporates are falling, perhaps due to the Federal Reserve’s financial stability report (see yesterday’s market update). Remember how spiking rates and the threat of inflation was the talk of the town in August and September? Well, since then inflation has moderated and rates have fallen. The five-year Treasury note yield is all the way back down to 2.83%, and the 10-year Treasury yield collapsed back to 3.02%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

August 30, 2018

August 30, 2018

Stocks opened lower this morning after breaking to fresh highs earlier in the week. The Dow is currently off 112 pts and the SPX is down .28%. The materials sector is down 1.3% in early trading on weakness in gold miners and chemical producers. Banks and transports are down about .5%. Healthcare stocks are roughly flat and utilities are up modestly. The VIX Index—a common gauge of fear among traders—is back up to 12.5 but that’s still a very low level. For context, during the correction last January/February, the VIX spiked briefly to 37. European stock markets will close about .5% lower in today’s session and most of Asia was down overnight. The US dollar is a bit stronger today against a basket of foreign currencies, reacting to strong economic data (see below). Most commodities are not surprisingly trading lower. But WTI crude oil is holding steady at $69.66/barrel. Bonds are higher in price, lower in yield today. The 5-year Treasury note yield backed down to 2.76% and the 10-year yield is at 2.86%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

March 1, 2018

Stocks are mixed this morning (Dow +31 pts; SPX -.17%). It seems traders like Fed Chair Powell’s tone as he reports to a US Senate committee. Utilities (+.6%), transports (+.8%) and energy (+.6%) are leading way. On the other hand, technology, gold miners, pharmaceuticals and retailers are in the red. The VIX Index is up around 20 again following yesterday’s rout. The dollar is a bit stronger and commodities are mostly weaker. WTI crude oil is trading below $61/barrel. That’s a 1-month low for oil, and yet most energy stocks are in the green today. Bonds are slightly higher in price, lower in yield. The 5-year Treasury yield is trading at 2.63% and the 10-year is back down to 2.85%. Remember, equities are taking their cue from the 10-year.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 30, 2017

Stocks gapped up at the open, reversing yesterday’s decline and setting new highs. The Dow is currently up 181 pts and the SPX is up .67%. The energy sector is rebounding about 1% after a 5% correction earlier this month. Semiconductors are also up 1% after suffering a 5.7% drop over the last few days. Interestingly, European and Asian stock markets were down overnight. And the VIX Index (Dec. futures contract) is trading up near 11.5. The dollar is weaker against a basket of foreign currencies today, mostly due to Euro & Pound strength after Brexit negotiators made constructive progress toward a split. Commodities are mixed; WTI crude is trading up around $57.70/barrel. OPEC meets today in Vienna. Bond yields are slightly higher on the day. The 5-year Treasury yield is up to 2.11% and the 10-year is now at 2.39%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

October 30, 2017

The major stock market averages gapped down at the open. The Dow is currently down 88 pts and the SPX is down .4%. The Nasdaq is down .2%. Gold miners and energy stocks are trading higher. On the other hand, pharmaceuticals, consumer staples, transports and banks are lower on the day. The dollar is a bit weaker against a basket of foreign currencies and commodities are modestly higher. WTI crude oil is treading water at $54/barrel (an 8-month high). Bond prices are higher on the day as yields tick lower. The 5-year Treasury yield is back down to 2.0% and the 10-year yield is down to 2.39% after recently spiking to 2.46%. But still, it seems the path of least resistance for interest rates is up.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

August 1, 2017

Stocks opened higher this morning and the Dow Jones Industrial Average set a fresh records high. At the moment, the Dow is up 80 pts and the SPX is up .18%. Telecoms, banks and semiconductors are leading the charge. On the other hand, biotechs, transports and energy companies are trading lower. WTI crude oil is  down 3% to trade around $48.50/barrel. Copper and iron ore are also in the red. Bonds are trading higher in price after some disappointing economic data. The 5-year Treasury yield dipped to 1.81% and the 10-year yield edged down to 2.26%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

June 30, 2017

Stocks opened modestly higher following yesterday’s rout. The Dow and SPX are currently up 58 pts & .18%, respectively. Most sectors are trying to bounce back, except for financials, healthcare and telecom. The deep cyclical-type groups are weaker today—biotechs, semiconductors, banks. The VIX Index is sitting at 11.5 and VIX are trading at 12.3. The dollar is modestly stronger today against a basket of foreign currencies, but oil prices are rising as well. WTI crude is trading up around $45.40/barrel. Bonds are ever-so-slightly lower in price, higher in yield. The 5-year Treasury yield ticked up to 1.86% and the 10-year yield is up to 2.28%


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

May 30, 2017

Stocks opened lower this morning, digesting recent gains. The Dow is currently down 30 pts and the SPX is off .1%. Telecoms are surging today, recovering some of their year-to-date losses. On the other hand, energy and financial sectors are down sharply. The dollar is a bit weaker this morning but most commodities aren’t rising. WTI crude oil is trading down to $49.35/barrel. Bonds are higher in price, lower in yield. The 5- and 10-year Treasury yields ticked down to 1.77% and 2.23%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

May 1, 2017

Stocks opened higher this morning (Dow +8 points; SPX +.26%). Consumer discretion, financials and tech are leading the way. Utilities, telecom and consumer staples are trading lower. The VIX Index is down modestly to trade around 10.6 and VIX May futures are just under 12. The dollar is pretty much unchanged and commodities are mostly higher, except for oil. WTI crude oil continues to slide, trading near $48.70/barrel. Many traders say it could go to $47 in the near-term. Remember, oil was above $53 less than a month ago. Bonds are down slightly today in price. The 5-year and 10-year Treasury yields edged up to 1.84% and 2.31%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

March 1, 2017

he Dow, Nasdaq and S&P 500 have just hit all-time highs. The Dow is up 245 points and just broke through 21,000. Cyclical sectors (unlike the last few trading sessions) are leading the way. Consumer discretionary, energy, financials, tech, materials and industrials sectors are all up over 1% in early trading. The VIX Index dived back under 12 after yesterday’s mini-spike to 13. There is virtually no fear in the market. The dollar is stronger today but commodities are also rising. WTI crude oil is flat just under $54/barrel. Bonds are finally reflecting a high chance that the Federal Reserve will hike interest rates this month. The 5- and 10-year Treasury yields are up to 1.99% and 2.46%, respectively. The 2-year Treasury yield—a better indication of expectations for the Fed—shot up to 1.29% and that’s the highest yield since the summer of 2009. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

February 7, 2017

Stocks opened higher this morning (Dow +47 pts; SPX +.1%). And by the way, the Nasdaq just touched a new record high. Gains are fairly widespread: retailers, transports, semiconductors, biotechs, REITs. But again today, the energy sector isn’t participating in the rally. WTI crude oil is down 1.4% to trade around $52.20/barrel. The VIX Index is down around 11.2 suggesting very little fear among traders. The dollar has been rising for the last week or so and all else equal, that should put some downward pressure on commodity prices. Bonds aren’t doing much today. The most likely direction for yields over the long-term is upward, but when the Fed passed on a chance to raise rates last week, that had a settling effect on bonds across the curve. The 5- and 10-year Treasury yields are trading at 1.85% and 2.41%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

January 30, 2017

Stocks sank at the open (Dow -166 pts, SPX -.9%). All eleven market sectors are lower, led by energy (-1.9%), materials (-1.3%), and financials (-1.2%). Biotechs are also down over 1%. The VIX Index is up sharply to trade around 12.3. Usually, stock declines coincide with VIX spikes. The dollar is about flat today but commodities are down almost across the board. WTI oil is down to $52.70/barrel. Bonds are rising in price, with yields lower. The 5-year Treasury yield is down to 1.93% and the 10-year is trading at 2.47%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 30, 2016

Stocks opened higher yet again this morning (Dow +63 pts; SPX +.17%). The SPX just hit another all-time high. Energy and financials are bouncing back with strength. Utilities, telecom and REITs, on the other hand, are lower. So as you might guess, oil prices and interest rates are moving higher again. WTI crude oil is up 7% to $48.70/barrel on rumors that OPEC has reached a deal to cut daily oil production by a whole 1.5%. Whoopee. And by the way, copper is up over 20% this year and it’s not because demand has risen by 20%. According to Bloomberg, speculators are driving up commodity prices. Volatility in that space is spiking. Bonds are selling off again today. The 5-year Treasury is up to 1.83% and the 10-year Treasury yield is trading up toward 2.38%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

October 31, 2016

Stocks opened mixed this morning (Dow -13 pts; SPX +.06%). The rate sensitive sectors—utilities, real estate—are up nicely in early trading. Biotechs, medical device stocks and the energy sector are in the red. WTI crude oil is trading sharply lower to $47.60/barrel as investors come to realize that OPEC’s jibber-jabber about a production cut is likely nothing but talk. Bonds prices are up a bit this morning as yields edged lower. The 5- and 10-year Treasury yields are back down to 1.32% and 1.83%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

August 29, 2016

Stocks opened higher this morning (Dow +107 pts; SPX +.48%). All ten major sectors are up in early trading. Financials (especially banks) are the clear leaders, with the sector up 1%. Biotechs are selling off. The VIX Index is down a bit to trade around 13.5 and VIX September futures are down around 15. European markets are poised to close a bit lower and Asia was mixed overnight. The dollar is stronger against a basket of foreign currencies and yet commodities are mostly lower. WTI crude oil is down about 2% to trade just under $47/barrel. Bonds are higher in price after selling off late last week. The 5- and 10-year Treasury yields are trading around 1.20% and 1.59%, respectively.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

August 2, 2016

Stocks opened sharply lower this morning despite some better-than-expected earnings announcements. The Dow and SPX are currently down 117 pts & .8%, respectively. All ten major market sectors are lower in early trading. Biotechs, semiconductors and transports are all down over 1% at the moment. The dollar is lower and commodities are higher—even oil, which has been in a downtrend lately. WTI crude oil is back up to $40.50/barrel. Bonds are lower as yields move up a bit. The 5- and 10-year Treasury yields are currently at 1.08% and 1.54%, respectively. Yields look like they want to move up in the near-term. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

May 31, 2016

The major stock market averages opened lower this morning (Dow -93 pts; SPX -.26%). Telecom and utilities sectors are up modestly, while most everything else is lower. The VIX Index is trading up to about 14, which is not considered elevated but we’ll see where it goes from here. The SPX is in the process of testing resistance (a prior high) at about 2110. It has failed at that level several times in the last year. So short-term traders are on alert. The dollar is modestly lower and commodities are mixed. Oil is trading up toward $49.90/barrel, and remember we haven’t seen oil trade consistently around $50 since last fall. Bonds are mixed. The 5-year Treasury yield is unchanged at 1.39% and the 10-year is unchanged at 1.85%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.