Stock indices had modest gains this week with emerging markets posting the largest gains. Consumer spending increased, but durable goods orders fell. Unemployment claims fell to a new pandemic low. The Biden administration and Republicans have moved closer to an infrastructure deal but still remain far apart.
Treasury yields fell with the 30-year bond yield closing at 2.264% and the 10-Year note closing at 1.584%. Crude oil rose to $66.62 a barrel and natural gas rose to $2.994 per MMBTUs. The U.S. dollar index fell to 90.06 and gold rose to $1906.80 an ounce.
In the economic numbers this week:
- The Commerce Department reported:
- Durable good orders fell 1.3% in April after 11 straight monthly gains and a 1.3% rise in March. Excluding transportation, new orders rose 1.0%.
- The second reading of gross domestic product in the first quarter was confirmed at a 6.4% annual growth rate.
- Consumer spending rose 0.5% in April. Goods purchases fell 0.6% but services spending rose 1.1% as more people ate at restaurants and traveled.
- Personal income fell 13.1% in April following March’s 20.9% increase from stimulus payments.
- The personal consumption price index, the one most closely used by the Federal Reserve, rose 0.6% in April. Excluding volatile food and energy the PCE price index rose 0.7%. From a year earlier the PCE index rose 3.6% and excluding food and energy, prices rose 3.1%.
- The Labor Department reported:
- A seasonally adjusted 406,000 workers filed initial claims for unemployment in the week ending May 22nd down from a revised 444,000 the week before.
- The 4-week moving average of claims, designed to smooth out volatility, fell to 458,750.
- Continuing claims fell from 3.7MM to 3.6MM in the week ending May 15th.
- A broader measure of claims including extended benefits, pandemic assistance and other programs fell from 16.0MM to 15.8MM in the week ending May 8th.
- For the full unemployment report go here: https://www.dol.gov/ui/data.pdf .
- The EIA weekly oil report is here: http://ir.eia.gov/wpsr/wpsrsummary.pdf . Also, the EIA reported in the prior week:
- Field production of crude was unchanged at 11.0MM BPD.
- Natural gas storage rose 115BN cubic feet and is below the average level at this time of year during the past five years.
- Baker Hughes reported the number of active oil rigs rose 3 to 359. The number of active natural gas rigs fell 1 to 98.
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Loren C. Rex, CFP®, MA Erik A Smith AIF®
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.