U.S. and foreign stocks ended the week lower as uncertainty on trade blunted rally attempts. Crude oil prices rose sharply higher due to a drop in U.S. inventories, disruptions in Libya and U.S. threats to prevent Iran from exporting oil by November 4th. Most other commodities were little changed. The 10-year Treasury yield fell, further flattening the yield curve. The dollar rose modestly. In July we will have the June jobs number on July 6th. 2nd quarter earnings come out in mid-July and are expected to be good. However, traders will be looking at revisions to future earnings estimates in light of tariffs. The first reading of Q2 gross domestic product will be out later in July.
In the numbers this week:
- The Commerce Department reported
- Sales of newly built homes rose 6.7% in May. The biggest gains were in the south.
- Revised Q1 GDP growth to an annual rate of 2%, down from the previous estimate of 2.2%. The revisions were due to shrinking inventories and reduced business equipment production. The decline in inventories may boost growth in Q2 when it is released in late July.
- Durable goods orders fell 0.6% in May after falling 1.0% in April.
- Personal consumptions expenditures rose a modest 0.2% in May when adjusted for seaonality. April’s spending increase was revised down to 0.5% and March was revised up to 0.6%.
- Personal income rose 0.4% in May.
- The price index for personal consumption expenditures, which is the FED’s preferred measure of inflation rose 0.2% in May. The index also rose 0.2% when excluding volatile food and energy prices. From a year ago, the index rose 2.3%, up from 2.0% in April. Excluding volatile food and energy, the index rose 2.0%, which is the FED’s target.
- S&P CoreLogic Case-Shiller National Home Price Index rose 6.4% in April from a year ago, down from 6.5% in March.
- The Labor department reported first time claims for unemployment rose 9,000 to a seasonally adjusted 227,000 in the prior week. The four week moving average of claims rose 1000 to a seasonally adjusted 222,000.
- The Energy Information Administration weekly report is attached. Also the EIA reported storage of natural gas rose 66BN cubic feet.
- According to Baker Hughes, In the past week the number of active oil rigs fell 4 to 858 and the number of active gas rigs fell 1 to 187.
Please call us if you have any questions.
Loren C. Rex, CFP®, AIF®, MA Erik A Smith
President Managing Partner
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
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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. The Indices mentioned are unmanaged and cannot be invested into directly.