Most stock indexes gained for the week as evidence grew that the U.S. and China are moving closer to a trade deal and retail sales came in positive for October. Emerging markets had slight declines. OPEC agreed to keep current production cuts in place through the end of next year, but did not cut production further. FED Chair Jerome Powell testified to the Joint Economic Committee and painted the U.S. economy in a positive light. Earnings releases this week were generally positive.
The 10-year Treasury yield fell to 1.836%. Crude oil gained to $57.87 a barrel. The U.S. dollar fell against a basket of currencies and gold prices rose to $1467.40 an ounce.
In economic numbers this week:
- China’s official National Bureau of Statistics reported
- Industrial output in October was up 4.7% from a year earlier, down from 5.8% year over year in September.
- Consumer prices were up 3.8% in October from a year earlier up from 3.0% year over year in September. The inflation increase was due mostly due to pork and pork alternatives due to the African swine fever. Non-food inflation rose at a modest 0.9% in October, down from 1.0% in September.
- Producer prices fell 1.6% in October with the decline accelerating from -1.2% in September.
- Germany reported 2nd quarter gross domestic product grew at an annual rate of 0.5%. Analysts had been expecting a 0.1% contraction.
- The Commerce Department reported U.S. retail sales rose 0.3% in the month of October. Spending at gasoline stations rose 1.1%, vehicle sales rose 0.5% and furniture and home furnishings sales fell 0.9%. Excluding gasoline and vehicle sales retail sales rose 0.1%.
- The Federal Reserve reported that industrial production fell 0.8% in October. The manufacturing component fell 0.6% although most of that was attributed to the General Motors strike. Mining production, including oil and gas, fell 0.7% and utility production fell 2.6%.
- The Labor Department reported
- First time claims for unemployment rose 14,000 to a seasonally adjusted 225,000. The four week moving average of claims rose to 217,000. While this still is historically a low number for first time claims, it is the highest in five months. It should be noted that numbers were estimated for a number of states due to the federal Veteran’s day holiday on Monday.
- The consumer-price index rose 0.4% in October. Excluding volatile food and energy, prices rose 0.2%. From a year earlier, consumer prices in October were up 1.8% up from the 1.7% year over year in the previous two months. Core prices were up 2.3% in October from a year earlier.
- The EIA weekly oil report is here wpsrsummary (1). Also, the EIA reported in the past week:
- Field production of crude oil rose from 12.6MM barrels per day to 12.8MM barrels per day.
- Natural gas storage increased by 3BN cubic feet and is and is slightly above the five year average at this time of year.
- Factset reported with 92% of S&P 500 companies reporting Q3earnings, the blended earnings decline was 2.3%. 75% of companies have beaten their estimates which is above the five year average.
- Baker Hughes reported the number of active oil rigs fell 10 to 674 and the number of active gas rigs fell 1 to 129.
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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
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. The Indices mentioned are unmanaged and cannot be invested into directly.