Stocks ended the week lower as fears of the new corona virus spreading offset good earnings and economic data. China has restricted travel for portions of the country during this lunar new year celebration. However, infected individuals have presented outside of Wuhan and in other countries with the U.S. now having five confirmed cases. While the Centers for Disease Control are closely monitoring the situation they say the risk for Americans is low.
The European Central Bank met under their new president, Christine Lagarde, and announced no change in interest rates. However, Lagarde stressed the ECB is not on autopilot.
The 10-year Treasury yield fell to 1.686%. Crude oil fell to $54.38 a barrel and natural gas fell to $1.868MMBTUs. The U.S. dollar fell against a basket of currencies and gold prices rose to $1570.30 an ounce.
In economic numbers this week:
- The International Monetary Fund is forecasting global growth of 3.3% following 2.9% in 2019. It attributes the increased growth to aggressive monetary policy and a détente in the trade war between the U.S. and China.
- The National Association of Realtors reported existing home sales rose 3.6% in December. Low unemployment and low interest rates were attributed to the increase.
- The Labor Department reported first time claims for unemployment rose 6,000 to a seasonally adjusted 211,000. The four week moving average of claims fell to 213,250.
- The EIA weekly oil report is here wpsrsummary (16). Also, the EIA reported in the past week:
- Field production of crude oil was unchanged at 13.0MM per day.
- Natural gas storage fell by 92BN cubic feet and is above the five year average at this time of year.
- Baker Hughes reported the number of active oil rigs rose 3 to 676 and the number of active gas rigs fell 5 to 115.
- Factset reported that with 17% of S&P 500 companies reporting, the blended earnings decrease was -1.9% from Q4 2018. Last week with 9% of the companies reporting the blended decline was -2.4%.
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Loren C. Rex, CFP®, AIF®, MA Erik A Smith AIF®
President Managing Partner
Generations Financial Planning & Wealth Management 269-441-4143
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Battle Creek, MI 49017
Carrie Fuce, Assistant 269-441-4091
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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.