Weekly Market Wrap: Stocks slipped this week on a World Bank global growth downgrade and concerns regarding the limits of global stimulus.
For The Week
- The S&P 500 lost 1.01% to 1,626.73
- Oil added 1.90% to $97.85
- Gold gained 0.80% to $1,390.29
- The US Dollar fell another 1.01% to $80.65 against other major world currencies.
2013 Year-To-Date for the major indexes:
- The S&P index +14.06%
- The Dow Jones Index +15.00%
- The NASDAQ Index +13.38%
- The Russell 2000 Small cap Index +15.54%
- EAFE International Index +5.33%
- 10 Year Treasury Yield is 2.11%, lower for the week and higher for the year
- 30 Year Treasury Yield is 3.39%, lower for the week and higher for the year
- WTI Crude Oil Index +6.57%
- Bloomberg Gold Index -16.95%
- The Dollar Index +1.05% against other major world currencies
Monday the S&P Index lost 1 point on low volume despite an upgrade to the US credit rating by S&P to “stable” 2 years after they initially lowered it. Overseas trade, lending and inflation data out of China disappointed, Japan 1Q GDP was revised higher, French industrial production beat and Italian GDP and industrial production missed.
Tuesday the index fell 17 points on moderate volume as small business optimism hit a one-year high and wholesale inventories were up. Overseas, no additional stimulus announcements from Japan and German courts discussed the legality of the Euro bond purchase program.
Wednesday stocks slumped 14 points on moderate volume as doubts regarding the future benefits of global stimulus surfaced and in the US mortgage applications rose.
Thursday stocks rebounded 24 points on moderate volume as jobless claims continued to drop and retail sales beat expectations snapping the first 3-day US stock losing streak of the year. Overseas Japan’s Nikkei dropped over 6% sending its market into bear territory and the World Bank downgraded world growth estimates.
Friday the S&P 500 lost 10 points on moderately light volume as consumer sentiment declined, industrial production was flat and producer prices rose.
Takeaways from this week:
- The upgrade of the US credit rating was based on the outlook of the US economy and is a good sign for future market prospects. Overall it was a decent week for US data, but not much data was released.
- World stocks moved lower once again this week with Japan continuing to lead the way.
- The US dollar has slipped considerably over the last few weeks.
Mortgage rates dropped his week. The national averages as reported by Bloomberg indicate a 15-year rate of 3.07% and a 30-year rate of 3.94%. These rates are as of 06/17/2013 and may include points.
What to watch for on the economic calendar next week:
Monday – NY Manufacturing / Housing Market Index
Tuesday – Consumer Prices / Housing Starts
Wednesday – FOMC Meeting Announcement and Forecasts
Thursday – Jobless Claims / Existing Home Sales / PMI Manufacturing / Philly Manufacturing / Leading Indicators
Friday – No data
Ronald J. VanSurksum, CFP®
Advanced Asset Management, LLC
June 17, 2013