Markets "in a Nutshell" for November 7, 2017Nov 07, 2017
How much has the US Dollar Index fallen so far in 2017?
a) It hasn’t, it has gone up
Answer to quiz below...
Investment Week at a Glance
Stocks finished mixed for the week. The Dow Jones Industrial Average was up 0.45%, the S&P 500 rose 0.26%, the New York Stock Exchange Composite (2,000 stocks) was up 0.05% and the average investors index (Value Line Index) was down 0.61%. Foreign stocks (DJ Global ex U.S.) were up 1.09%. Bond prices were higher for the week, pushing the yield on the 10-year U.S. Treasury down 8 basis point to finish the week at 2.33%. (Data sources: Barron’s Financial, Wall Street Journal)
Markets Keep Climbing
Economic data in the U.S. continued to keep investors happy last week. Initial jobless claims came in lower than expected, consumer confidence was higher than anticipated, both manufacturing PMI and personal spending beat estimates, and unemployment fell to a 17-year low.
Shares of energy companies were the best performers in the U.S. equity markets, due to stronger-than-expected corporate earnings driven by higher oil prices. Technology stocks also performed well as tech companies’ earnings beat estimates. However, telecommunications firms underperformed for the week, as recent earnings reports showed them struggling to generate growth.
In the fixed-income markets, long-duration bonds outperformed as long-term interest rates moderated during the week. Municipal bonds lagged, due to uncertainty about potential tax law changes that could threaten these bonds’ interest deductibility.
Mixed International Data
Internationally, economic data was more mixed. Japan reported better-than-expected industrial production, while the UK’s manufacturing PMI exceeded expectations. Conversely, we saw disappointing manufacturing PMI results from Russia, China and the European Union.
Asian emerging markets outperformed as emerging markets currencies appreciated and global economic data impressed. In contrast, Latin American shares struggled for the week. Disappointing earnings from several large Brazilian companies dragged down performance.
c) The ICE US Dollar Index, which is a way to measure the dollar’s performance against its main rivals, has dropped more than 7% so far this year.