AAM Weekly Market Wrap – March 24, 2013

Weekly Market Wrap: Stocks slipped this week as positive US economic and earnings data were not quite enough to overcome global concerns regarding Cyprus banks.

 

For The Week

  • The S&P 500 slipped 0.24% to 1,556.89
  • Oil rose 0.32% to $93.75
  • Gold added 1.02% to $1,607.75
  • The US Dollar gained 0.19% to $82.39 against other major world currencies.

2013 Year-To-Date for the major indexes:

 

  • The S&P index +9.16%
  • The Dow Jones Index +10.74%
  • The NASDAQ Index +7.47%
  • The Russell 2000 Small cap Index +11.41%
  • EAFE International Index +5.16%
  • 10 Year Treasury Yield is 1.91%, lower for the week and higher for the year
  • 30 Year Treasury Yield is 3.14%, lower for the week and higher for the year
  • WTI Crude Oil Index +2.10%
  • Bloomberg Gold Index -3.95%
  • The Dollar Index +3.23% against other major world currencies

 

 

Monday the S&P 500 dropped 9 points on moderate volume as Cyprus bank woes and contagion worries pushed global stocks lower while US homebuilder sentiment fell as well.

Tuesday stocks slipped 4 points on moderate volume as Euro worries continued while Cyprus voted down adding a bank deposit tax and the bailout agreement.  US housing starts beat expectations.

Wednesday stocks gained 10 points on moderate volume as the Fed maintained its current easy monetary policy and mortgage applications declined.

Thursday stocks dropped 13 points on moderate volume as Cyprus bailout worries remained, weekly jobless claims rose but less than expected, the Philly Fed index rose into expansion territory, the leading economic indicators beat expectations and existing home sales slightly missed.

Friday stocks rose 11 points on light volume as a week of positive earnings reports and economic data pushed stocks higher despite continued uncertainty in Europe and Cyprus.

 

Takeaways from this week:

  • Europe was back in the news this week as Cyprus, a small Island country, will need help to bailout its banks.  Cyprus’ economic output is less than the State of Indiana’s.  The real concern regarding Cyprus would be a crisis of confidence and a possible domino effect of one banks failure leading to another’s.  One of the possible remedies was even more controversial than a bailout.  A tax on bank deposits seeking a seizure of 10% of all deposits.  This most certainly would add to any crisis of confidence and could result in a run on bank assets.  It should be an interesting week.
  • Housing data again was mostly positive adding to the positive US economic sentiment.

 

 

Mortgage rates moved slightly higher last week.  The national averages as reported by Bloomberg indicate a 15-year rate of 2.89% and a 30-year rate of 3.73%. These rates are as of 03/22/2013 and may include points.

 

What to watch for on the economic calendar next week:


Monday – Dallas Fed Manufacturing

Tuesday – Durable Goods Orders / Home Prices / New Home Sales / Consumer Confidence

Wednesday – Pending Home Sales

Thursday – Jobless Claims / 1Q GDP / Chicago PMI

Friday – Personal Income & Outlays / Consumer Sentiment

 

 

Ronald J. VanSurksum, CFP®
Advanced Asset Management, LLC
March 24, 2013

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