Stocks rose this week on hopes that some of the data would cause the Federal Reserve to delay the first rate increase. The FED announcement following its meeting Wednesday did not give any indication of this. However, anemic wage growth and a so-so 2nd quarter Gross Domestic Product growth encouraged this thinking. .
Economic Numbers this week include:
- The Commerce Department reported:
o Durable goods orders rose 3.4% in June, better than expectations, after falling 2.1% in May. The gain was attributed mainly to nondefense aircraft orders which were up 66.1%. Excluding the transportation sector, durable goods were up 0.8%, the largest monthly increase since August 2014.
o Second quarter gross domestic product grew at a seasonally adjusted 2.3% annual rate. Strong consumption and residential investment were the main drivers of the growth. Government spending increased at a 0.8% rate and business spending actually declined at a 0.6% rate. The first quarter’s GDP was revised from a 0.2% decline to a 0.6% increase.
- The National Association of Realtors reported that pending home sales fell in June by a seasonally adjusted 1.8% but are still 8.2% higher than a year ago.
- The US Energy Information Administration reported that domestic crude inventories fell 0.9% in the prior week due to a drop in imports and domestic production.
- The Labor Department reported:
o Initial jobless claims in the prior week rose 12,000 to 267,000 coming off a 42 year low. The four week moving average of claims, designed to smooth weekly fluctuations, fell 3,750 to 274,750.
o The employment cost index (including wages and benefit costs) rose a seasonally adjusted 0.2% in the second quarter. Civilian wages and salaries also rose only 0.2%. Both figures were the lowest on record since recordkeeping began in 1982.
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Loren C. Rex, CFP®, AIF® Erik Smith
Generations Financial Planning & Wealth Management
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Carrie Fuce, Assistant 269-441-4091
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