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    Markets "In a Nutshell" for July 24, 2018

    Jul 24, 2018

    Investment Week at a Glance

    Stocks were mostly up last week. The Dow Jones Industrial average rose 0.1%. The S&P 500 was up 0.02% while the New York Stock Exchange Composite (2,000 stocks) was up 0.2%. The “average investor’s index” (Value Line index) declined 0.03% and foreign stocks (DJ Global ex U.S.) were up 0.4%. Bond yields were up as the 10 year Treasury ended 2.89%. (Data sources: Barron’s Financial, Wall Street Journal)

     

    More good job news

    The Labor Dept. reported that jobless claims (those people filing for unemployment) fell to a seasonally adjusted 207,000. This was the lowest jobless number since December 1969 (yep, 49 years ago!). What does this mean for investors? The numbers would point to a strong economy which should mean continued strong corporate profits as well as continued interest rate increases. Could for good for stocks and investors looking for safe haven investments (such as bank cd’s or other short term investments).

     

    Corporate earnings strong

    According to Barron’s 75 S&P 500 companies have reported earnings for the year over year quarter. 71 of the 75 reported earnings that exceeded projections. Overall corporate earnings are expected to grow by 17% year over year. As ultimately earnings are what drive stocks in the long run, good earnings numbers bode well for the stock market.

     

    $100 oil?

    Oil prices have been on the move upward this year. We all can feel it at the pump where national gasoline prices are now $2.84 a gallon vs. $2.20 a year ago. Banyan Hill analyst Matt Badiali believes we could see oil prices head to $100 a barrel (which would push pump prices well into the $3 a gallon range). Global tensions in the Middle East as well as Venezuela’s failure are contributing to the supply constraints. Badiali also notes that after oil prices dropped 2 years ago many producers cut back supply and this has led to an imbalance in the supply and demand equation. We have been adding to our energy positions for client portfolios the past 6 months in anticipation of higher prices and we are likely to continue adding energy holdings.

     

    Quiz:

    According to the SSA, What percent of Americans wait until age 70 to file for Social Security? a. 3.7% b. 9.6% c. 14.4% d. 21.3%...Answer is below…

     

    Have a good week!

     

     

     

     

    Answer to quiz:

    a. 3.7%