Weekly Market Insights header image

Weekly Market Insights

Market Summary (as of market close ​​June ​14​​, 2019)

While not as robust as the prior week, stocks still managed to post gains for the second week in a row. Last week started off with a bang for the benchmark indexes listed here, only to slip lower by Friday as tensions in the Middle East mounted. After getting pummeled in May, stocks have slowly regained some momentum during the early part of June. Year-to-date gains for each of the indexes listed here are in double digits, except for the Global Dow, which is off by less than half a percentage point. Oil prices slipped again last week, while long-term bond yields remained relatively unchanged.

Oil prices decreased to $52.51 per barrel by late Friday, down from the prior week's price of $54.04. The price of gold (COMEX) fell last week, dropping to $1,344.80 by Friday evening, down slightly from the prior week's price of $1,345.00. The national average retail regular gasoline price was $2.732 per gallon on June 10, 2019, $0.075 lower than the prior week's price and $0.179 less than a year ago.

Market/Index

2018 Close

Prior Week

As of ​​6/​14

Weekly Change

YTD Change

DJIA

23327.46

25983.94

2​6089.61

0.41%

11.84%

Nasdaq

6635.28

7742.10

7796.66

0.70%

17.50%

S&P 500

2506.85

2873.34

2886.98

0.​47%

1​5.16%

Russell 2000

1348.56

1514.39

1522.50

0.​54%

1​2.90%

Global Dow

2736.74

2990.88

2998.79

0.​26%

9.​58%

Fed. Funds target rate

2.25%-2.50%

2.25%-2.50%

2.25%-2.50%

0 bps

0 bps

10-year Treasuries

2.68%

2.​09%

2.​09%

0 bps

-​​59 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week's Economic Headlines

  • Overall, prices producers received for goods and services edged up 0.1% in May after increasing 0.2% in April. Prices for services increased 0.3%, largely due to a 10.1% jump in guestroom rentals. Prices for services actually carried the spurt in producer prices, as the prices for goods actually dropped 0.2% in May following three consecutive monthly increases. A majority of the decrease can be traced to a 1.0% drop in energy prices. Within the energy sector, gas prices fell 1.7% in May.
  • According to the Consumer Price Index, prices consumers paid for goods and services inched up 0.1% in May — the same rate increase as producer prices. The CPI rose 0.3% in April. Over the last 12 months ended in May, the CPI has risen 1.8%. Prices less food and energy also increased 0.1% in May for the fourth consecutive month. Prices less food and energy have climbed 2.0% since May 2018. Within consumer prices, food prices increased 0.3% and prices for medical care services jumped 0.5%. On the other hand, energy prices fell 0.6% and used car and truck prices dropped 1.4%. Evidencing marginal inflationary pressures, the scant increases in both the Consumer Price Index and the Producer Price Index could influence the Federal Open Market Committee to keep interest rates at their current level following its meeting later this week.
  • Sales at the retail level rose 0.5% in May following a 0.3% increase in April. For the year, retail sales have climbed 3.2% since May 2018. Online sales spiked 1.4% in May and are up 11.4% over the last 12 months. Areas experiencing a good sales month include sporting goods, hobby, musical instrument & book stores (1.1%) and electronics & appliance stores (1.1%).
  • The federal budget deficit sat at $207.8 billion in May. There was a surplus of $160.3 billion in April (tax month). Fiscal year-to-date, the government is operating at a deficit of $738.6 billion compared to a deficit of $532.2 billion over the same period last fiscal year. Last month, the largest outlays were for Medicare ($98 billion), Social Security ($88 billion), and national defense ($65 billion). On the other side of the ledger, individual income taxes brought in $104 billion, while corporate taxes accounted for $0.4 billion of total government receipts.
  • Industrial production rose 0.4% in May after falling 0.4% in April. The indexes for manufacturing and mining gained 0.2% and 0.1%, respectively, in May, while the index for utilities climbed 2.1%. Total industrial production was 2.0% higher in May compared to a year earlier.
  • Prices for U.S. imports declined 0.3% in May following an increase of 0.1% the previous month. This is the first monthly decline in import prices since last December. Import fuel prices fell 1.0%, helping to drive the overall import price decline last month. Over the 12 months ended in May, import prices have decreased 1.5%. Export prices fell for the first time since January, dropping 0.2% in May, after advancing 0.1% in April. Export prices decreased 0.7% over the past 12 months ended in May, the largest year-over-year decline since prices dropped 1.1% for the 12-month period ended in October 2016. Agricultural export prices fell 5.3% over the past year, the largest 12-month drop since the index declined 9.1% in April 2016. All of this information references a period just before the United States increased tariffs on $200 billion of Chinese imports. Next month's figures should reflect the impact, if any, of those tariffs.
  • According to the Job Openings and Labor Turnover report, the number of job openings was little changed at 7.4 million on the last day of April. Job openings increased in federal government (+22,000) and educational services (+20,000). Job openings decreased in professional and business services (-172,000). The number of job openings was little changed in all four regions. Over the month, the number of hires edged up to 5.9 million (+240,000 from March). Total separations, which include quits, layoffs, and discharges, increased by 70,000 to 5.6 million in April. Over the 12 months ended in April, hires totaled 69.6 million and separations totaled 66.8 million, yielding a net employment gain of 2.8 million.
  • For the week ended June 8, there were 222,000 claims for unemployment insurance, an increase of 3,000 from the previous week's level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims remained at 1.2% for the week ended June 1. The advance number of those receiving unemployment insurance benefits during the week ended June 1 was 1,695,000, an increase of 2,000 from the prior week's level, which was revised up by 11,000.

Eye on the Week Ahead

The Federal Open Market Committee meets this week. Although the stock market has bounced back some, inflation remains stagnant and ongoing economic pressures from the trade war with China are likely to discourage an interest rate hike.

Data sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: 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.


Market Summary (as of market close ​​June 7​​, 2019)

Markets rebounded nicely last week on hopes that the Federal Reserve Board will cut interest rates in the near future. Early in the week, Chairman Jerome Powell said the Fed was closely watching trade developments and signaled rate cuts may be an option if the economic outlook worsens. And on Friday, a weak jobs report supported the possibility of future rate cuts, further encouraging investors. All the indexes tracked here climbed more than 3%, with the large caps of the Dow and S&P 500 surpassing 4% for the week. With the exception of global stocks, all year-to-date returns topped 10%.

Oil prices rose to $54.04 per barrel by late Friday, up from the prior week's price of $53.33. The price of gold (COMEX) also rose last week, reaching $1,345.00 by Friday evening, up from the prior week's price of $1,310.30. The national average retail regular gasoline price was $2.807 per gallon on June 3, 2019, $0.015 lower than the prior week's price and $0.133 less than a year ago.

Market/Index

2018 Close

Prior Week

As of ​​6/​7

Weekly Change

YTD Change

DJIA

23327.46

24815.04

2​5983.94

4.71%

11.39%

Nasdaq

6635.28

7453.15

7742.10

3.88%

16.68%

S&P 500

2506.85

2752.06

2873.34

4.41%

14.62%

Russell 2000

1348.56

1465.49

1514.39

3.34%

12.30%

Global Dow

2736.74

2888.03

2990.88

3.56%

9.29%

Fed. Funds target rate

2.25%-2.50%

2.25%-2.50%

2.25%-2.50%

0 bps

0 bps

10-year Treasuries

2.68%

2.​13%

2.​09%

-​4 bps

-​​59bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week's Economic Headlines

  • The employment report revealed an increase of just 75,000 jobs in May, compared to a monthly average of 164,000 in 2019. Gains were reported in professional and business services and health care. Little change was noted in construction, mining, manufacturing, wholesale trade, retail trade, transportation and warehousing, information, financial activities, leisure and hospitality, and government. Hourly wages increased by $0.06 to $27.83, bringing the average increase in hourly earnings over the past year to 3.1%. The March and April figures were revised downward by a total of 75,000 jobs.
  • At 50.5, the IHS Markit U.S. Manufacturing Purchasing Managers' Index™ (PMI™) reached its lowest level in May since September 2009, as output slowed and new orders dropped for the first time since August 2009. Weak demand and concerns surrounding ongoing trade negotiations caused manufacturers to express their joint-lowest level of confidence since the outlook was first measured in July 2012. The May reading was 2.1 points lower than April. "The data for the second quarter so far have indicated a distinct slowdown in the manufacturing sector compared to the first three months of 2019," the report said.
  • Although the Institute for Supply Management (ISM) Purchasing Managers Index dropped 0.7 percentage point from its April reading, to 52.1% in May, the reading indicates that economic activity in the sector continued to expand (a reading above 42.9% over a period of time indicates expansion). New orders, employment, and prices rose, while production, supplier deliveries, and inventories decreased.
  • The ISM's Non-Manufacturing Index came in at 56.9% in May, 1.4% higher than April. Business activity, new orders, and employment all posted gains, while prices decreased. According to the report, survey respondents "...are optimistic about overall business conditions, but concerns remain about tariffs and employment resources."
  • According to the U.S. Census Bureau "Monthly U.S. International Trade in Goods and Services" report, the deficit fell $1.1 billion from March to April, to $50.8 billion. Exports were $206.8 billion, while imports were $257.6 billion. The April deficit reflected a decrease in the goods deficit of $1 billion, and an increase in the services deficit of $0.1 billion. Year-to-date, the goods and services deficit rose $4.1 billion, or 2%, from the same period in April 2018.
  • For the week ended June 1, there were 218,000 claims for unemployment insurance, unchanged from the previous week's revised level. According to the Department of Labor, the advance rate for insured unemployment claims remained at 1.2% for the week ended May 25. The advance number of those receiving unemployment insurance benefits during the week ended May 25 was 1,682,000, an increase of 20,000 from the prior week's level, which was revised up by 5,000. 

Eye on the Week Ahead

Next week, investors and the Federal Reserve Board will get another perspective on how the economy is faring, as inflation numbers are on tap. Other key reports include the federal budget, retail sales, industrial production, and consumer sentiment.

Data sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: 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.

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2019.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

Market summaries contain information on the Dow, S&P 500, NASDAQ, Russell 2000, Global Dow, Federal Funds interest rate, and 10-year Treasury yields, as well as highlights of past and future economic data.

2998.45

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