The surprise of this week was that the Paris attacks did not affect global markets this week. Both U.S. and foreign stocks rose. Treasury bond yields were mixed and commodities, mainly energy and precious metals, were lower. The dollar rose on anticipation of a Fed rate increase and increased stimulus in Europe. The FED minutes showed members had concerns that delaying a rate increase could increase market uncertainty. Also, there was concern that delay would demonstrate a lack of confidence in the U.S. economy. The minutes said the FED needed to see positive data before the December 15th meeting.
In economic news this week:
- Japan’s economy contracted at 0.8% annual pace in the third quarter. This follows a revised contraction of 0.7% in the second quarter. The encouraging part of the third quarter figure is that the contraction was mainly due to a reduction in inventories. This could signal a pickup going forward.
- US Consumer prices rose a seasonally adjusted 0.2% in October. Excluding volatile food and energy, prices also rose 0.2%. This follows two months of declines. Over the past year prices have risen only 0.2% but excluding food and energy prices have risen 1.9%.
- The Federal Reserve reported that industrial production declined 0.2% in October mainly due to decline in crude oil prices and decreased electrical use due to a mild fall. However, manufacturing output (excluding things like oil, mining and utilities) rose 0.4% following a 0.1% decline in September.
- The Commerce Department reported that housing starts fell 11% in October on a seasonally adjusted basis. Single family homes were down 2.4% and multifamily construction fell 25.1%. The monthly housing numbers are quite volatile from month to month. New applications for building permits rose 4.1%. The September housing start number was revised from a 6.5% gain to a 6.7% gain.
- The Labor Department reported that jobless claims fell 5,000 to 271,000 in the prior week. The four week moving average of claims rose 3,000 to 270,750.
Please call us if you have any questions,
Loren C. Rex, CFP®, AIF® Erik Smith
Generations Financial Planning & Wealth Management 269-441-4143
77 E. Michigan Ave, Suite 140
Battle Creek, MI 49017
Carrie Fuce, Assistant 269-441-4091
Toll Free: 800-513-8180
Visit our Website: www.genfinplan.com
Registered Representative of and securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Generations Financial Planning & Wealth Management are separate companies and are not affiliated.
These are the opinions of Loren Rex and Erik Smith and are not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice.