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markets march ahead

 

Last week, markets marched ahead within a busy reporting week. The Dow rose 1.16% to close Friday on another new high. The S&P 500 notched a record high during the week, despite closing the week slightly down 0.02%. Meanwhile, the NASDAQ slipped 0.20%, and the MSCI EAFE rose 0.21%.

Generally strong corporate earnings reports helped markets continue to hit highs. The majority of companies that have posted Q2 earnings so far have beaten their estimates. Those earnings performances helped push financials, materials, and energy stocks up by over 1% early in the week. Health care companies also posted substantial earnings as S&P 500 health care stocks have risen 16% this year. Health insurer stocks have also increased by 22%.

 

Additionally, Q2 Gross Domestic Product (GDP), consumer confidence, exports, housing, and oil all reported noteworthy developments.

 

A Rundown of Last Week’s Developments

  • Solid GDP Performance: For the second quarter, GDP came in at a 2.6% annualized rate—one of the strongest quarters in the last 2 years. GDP growth was based on robust consumer spending for durable and nondurable goods. In addition, business investment hit a solid 5.2% annualized increase for the quarter.
  • Healthy Consumer Confidence: Consumer confidence remains quite high with the index rising in July almost 4 points to 121.1. The index beat the optimistic estimate of 118 and has jumped approximately 20 points since last November’s election, staying near March’s 17-year high of 124.9. In addition, the consumer sentiment index moved up modestly the last two weeks of July to end at 93.4.
  • Decent Export and Import Numbers: Food products and capital goods helped exports rise by 1.4% in June. Further, wholesale and retail inventories both jumped 0.6%. Imports, however, fell 0.4% on lower industrial supplies and consumer goods.
  • Mixed Home Sales: A tight labor market and low mortgages continue to spur demand for housing. In June, new home sales recorded a strong 610,000 annualized rate. Meanwhile, existing home sales dropped 1.8% in June to an annualized rate of 5.5 million, which was lower than anticipated. Existing home prices, however, were up 6.5% year-over-year, with a median price of $263,800.
  • Better Oil Prices: Oil prices rose this week, hitting the highest weekly percentage gains this year. Prices strengthened with news of shrinking U.S. crude and gas inventories, along with foreign efforts to reduce output.

 

What Lies Ahead

The Fed observed in its meeting last week that risks to the economic outlook seem stable. In its analysis of the economy, the Fed pointed to moderate economic growth, a sturdy employment environment, and positive business investments. As expected, the Fed did not increase interest rates but suggested that unwinding its $4.5 trillion balance sheet could begin as early as September.

This week will again offer key economic data to help provide a better understanding of market performance in June and early indicators for July. As always, we are here to answer any questions you may have about our economy and your financial life.  

 


 

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  • The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
  • The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.
  • The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.
  • The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
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http://www.goodhousekeeping.com/food-recipes/easy/a36266/classic-chicken-parmesan/            

https://www.irs.gov//uac/newsroom%20/making-the-most-out-of-miscellaneous-deductions         

http://www.golfdigest.com/story/tom-watson-drive-it-lower-in-crosswinds

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http://www.care2.com/greenliving/whats-the-best-temperature-for-your-home.html

 

 

 

 

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