AAM Weekly Market Wrap – December 24, 2012

Weekly Market Wrap:  Stocks were higher for the week but ended on a sour note with a trip over the fiscal cliff now looking like a reality.

 

For The Week

  • The S&P 500 Index gained 1.17% to 1,430.15
  • Oil added 2.32% to $88.74
  • Gold dropped 2.34% to $1,655.10
  • The US Dollar added 0.01% to $79.61 against other major world currencies.

Year-To-Date for the major indexes:

 

  • The S&P index +13.72%
  • The Dow Jones Index +7.97%
  • The NASDAQ Index +15.96%
  • The Russell 2000 Small cap Index +11.18%
  • EAFE International Index +13.72%
  • 10 Year Treasury Yield at 1.75%
  • 30 Year Treasury Yield at 2.92%
  • WTI Crude Oil Index -10.38%
  • Bloomberg Gold Index +5.82%
  • The Dollar Index -0.79% against other major world currencies

 

 

Monday the S&P 500 gained 17 points on moderate volume as rumors of a fiscal cliff compromise sent stocks higher, NY manufacturing disappointed and overseas an election in Japan added to positive investor sentiment.

Tuesday stocks added 16 points on heavy volume as Boehner offered a plan “B” to avoid the fiscal cliff and US homebuilder sentiment rose to its highest point since April 2006.

Wednesday stocks dropped 11 points on moderate volume as Boehner’s plan B made its way to the house for a vote, housing and mortgage data missed expectations and the US Treasury announced plans to sell GM stock it received as part of the bailout.

Thursday stocks rebounded 8 points on moderate volume as US existing home sales beat expectations, the final revision to 3Q GDP beat expectations at 3.1%, jobless claims rose slightly, Philly manufacturing beat expectations and the leading economic indicators fell slightly but were in-line with expectations.

Friday stocks dropped 14 points on heavy volume as Boehner’s plan “B” vote was cancelled due to lack of support from house Republicans, US durable goods orders beat, personal income and spending beat and consumer sentiment moved lower.

 

Takeaways from this week:

  • Positive fiscal cliff sentiment early in the week turned negative as the Republicans could not get enough votes together to pass their own bill.  Unless some sort of extension is agreed upon in the next week it looks like the cliff will not be avoided.

 

Mortgage rates were slightly higher this week.  The national averages as reported by Bloomberg indicate a 15-year rate of 2.82% and a 30-year rate of 3.44%. These rates are as of 12/21/2012 and may include points.

 

What to watch for on the economic calendar next week:


Monday – No data – markets close early

Tuesday – No data – Merry Christmas everyone!!

Wednesday – Home Prices

Thursday – Jobless Claims / New Home Sales / Consumer Confidence

Friday – Chicago Manufacturing / Pending Home Sales

 

 

Ronald J. VanSurksum, CFP®
Advanced Asset Management, LLC
December 24, 2012

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