Weekly Economic Update – May 28, 2013

John J. Barrios, CFP® Presents:

 

WEEKLY ECONOMIC UPDATE

 

 

WEEKLY QUOTE

             

“Let him who would enjoy a good future waste none of his present.”

     

– Roger Babson

     

   

WEEKLY TIP

             

What’s more important for a young couple: an emergency fund, or saving for a down payment on a home? The emergency fund gets the nod if your finances allow you to save toward only one of these two financial objectives.  

  

  

WEEKLY RIDDLE

           

Rigid is my spine, my innards are mostly pale, yet I am always ready to tell a tale. What am I? 

  

 

Last week’s riddle:

What should the next number be in this series: 103, 107, 109, 113, 127 …

   

Last week’s answer:

131, as the whole series is made up of prime numbers.

 

 

May 27, 2013

    

APRIL DATA AFFIRMS HOUSING REBOUND

Last month brought a 2.3% gain in new home sales and an 0.6% increase in existing home sales. Distressed properties (short sales and foreclosures) represented only 18% of residential resales in April, the National Association of Realtors noted; compare that with 28% of sales in April 2012. NAR also announced that the median existing home price was $192,800 in April, 11.0% higher than a year ago. The pace of new home buying has improved 29.0% in the past 12 months, according to the Census Bureau.1,2

  

FED MINUTES DISCLOSE THOUGHTS OF TAPERING QE3

The May 1 Federal Open Market Committee minutes were released last Wednesday, shortly after Federal Reserve chairman Ben Bernanke mentioned the need to sustain the central bank’s current stimulus effort in Congress. The minutes, however, noted that “a number” of Fed officials were open to scaling down QE3 as soon as June if economic indicators sufficiently improved. Concern and confusion about these mixed messages put more volatility into the markets and factored into a 3-day losing streak for the S&P 500.3

    

DURABLE GOODS ORDERS UP 3.3% IN APRIL

This contrasts with March’s 5.9% decrease. With transportation orders factored out, the April increase was still 1.3%. Census Bureau reports have noted improvements in hard goods orders in two of the past three months, even with the sequester.4

   

RUSSELL 2000 REACHES A MILESTONE

While the small-cap benchmark fell 1.20% last week, it also made history on May 20: it attained the 1,000 level for the first time. The RUT settled Friday at 984.28. The S&P 500 (-1.07% to 1,649.61), DJIA (-0.33% to 15,303.10) and NASDAQ (-1.14% to 3,459.14) all slipped last week.4,5,6,7

    

THIS WEEK: U.S. financial markets are closed Monday in observance of Memorial Day. Tuesday sees the release of the March S&P/Case-Shiller Home Price Index, the Conference Board’s May consumer confidence survey and earnings from Tiffany & Co. and Wet Seal. DSW and Chico’s announce Q1 results on Wednesday. In addition to new initial jobless claims figures, Thursday offers NAR’s report on April pending home sales, the federal government’s second estimate of Q1 GDP, and earnings from Krispy Kreme, BigLots! and Costco. Friday, the Commerce Department issues its report on April personal spending and the University of Michigan’s final May consumer sentiment survey arrives.

  

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+16.78

+22.13

+4.52

+7.79

NASDAQ

+14.56

+21.83

+8.30

+12.91

S&P 500

+15.66

+24.91

+3.98

+7.68

REAL YIELD

5/24 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

-0.26%

-0.38%

1.36%

1.72%

 


Sources: usatoday.com, thestreet.com, bigcharts.com, treasury.gov – 5/24/134,7,8,9,10

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends.

 

 

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John Barrios is registered to offer securities through First Heartland Capital, Inc. Member FINRA & SIPC, and offer advisory services through First Heartland Consultants, Inc.   Barrios Financial Services is not affiliated with First Heartland Capital, Inc.  

 

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

 

Citations.

1 – csmonitor.com/Business/new-economy/2013/0523/New-home-sales-rise-but-market-still-a-long-way-from-normal [5/23/13]

2 – realtor.org/news-releases/2013/05/april-existing-home-sales-up-but-constrained [5/22/13]

3 – reuters.com/article/2013/05/22/markets-usa-stocks-idUSL2N0E321R20130522 [5/22/13]

4 – thestreet.com/story/11933260/1/sp-poised-for-three-day-losing-streak-amid-qe-wind-down-chatter.html [5/24/13]

5 – marketwatch.com/story/russell-2000-index-breaks-above-1000-2013-05-20 [5/20/13]

6 – blogs.barrons.com/stockstowatchtoday/2013/05/24/dow-ekes-out-friday-gain-down-for-the-week/ [5/24/13]

7 – usatoday.idmanagedsolutions.com/stocks/overview.idms?index=SP500 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F24%2F12&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F24%2F12&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F24%2F12&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F23%2F08&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F23%2F08&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F23%2F08&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F23%2F03&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F23%2F03&x=0&y=0 [5/24/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F23%2F03&x=0&y=0 [5/24/13]

9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/24/13]

10 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/24/13]

 

 

 

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