In this week’s recap: stocks flirt with record highs, China and the U.S. continue negotiations toward a trade deal, and consumer sentiment improves.

Weekly Economic Update


Presented by Hennings Financial, October 28, 2019

 

THE WEEK ON WALL STREET

The S&P 500 came within 0.1% of a record close Friday. Stocks were lifted last week by positive news on U.S.-China trade negotiations, plus earnings announcements.

The Nasdaq Composite posted the largest weekly gain of the three major U.S. stock indices. It rose 1.90%. Last week also brought gains of 0.70% for the Dow Jones Industrial Average and 1.22% for the S&P. The MSCI EAFE, a benchmark for developed stock markets outside the U.S., rose 1.14%.1,2,3

 

Another Hint of Progress in Trade Talks

Friday, the Office of the U.S. Trade Representative stated that parts of a new trade deal with China were near completion. No specifics were given as of Friday’s close, but the USTR noted that negotiators had “made headway” on key issues.

Analysts think both sides may cancel certain tariffs as part of a deal. President Trump has said that he would like to sign a new trade accord with China’s President, Xi Jinping, next month.4

 

A Gain for Consumer Sentiment

Rising to a final October mark of 95.5, the University of Michigan’s Consumer Sentiment Index advanced 2.3 points month-over-month. During August and September, the index’s level varied from 89.8 to 93.2.5

 

What’s Next

The Federal Reserve meets this week. Will it make another interest rate cut? And if it does, could it be the last rate cut for a while? Traders will study the language of the statement and listen carefully to Fed chair Jerome Powell’s Wednesday press conference for clues.


 

T I P   O F   T H E   W E E K

This is the time of year to think about year-end charitable gifts. Consider and research organizations you might wish to donate to and inquire about the possible tax advantages that could come from those contributions.


 

THE WEEK AHEAD: KEY ECONOMIC DATA

Tuesday: The Conference Board presents its October Consumer Confidence Index.

Wednesday: The Federal Reserve makes its latest statement on monetary policy, and Automatic Data Processing (ADP) publishes its October private-sector payrolls report.

Thursday: The Department of Commerce offers September consumer spending data.

Friday: November begins with the Department of Labor’s October jobs report and the Institute for Supply Management’s newest Purchasing Managers Index for the factory sector, a gauge of U.S. manufacturing activity.

Source: Econoday, October 25, 2019

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: AT&T (T), Alphabet (GOOG), HSBC (HSBC)

Tuesday: Amgen (AMGN), BP (BP), Mastercard (MA), Merck (MRK), Pfizer (PFE)

Wednesday: Apple (AAPL), Facebook (FB), GlaxoSmithKline (GSK), Starbucks (SBUX)

Thursday: Altria (MO), Bristol-Myers Squibb (BMY), Sanofi (SNY)

Friday: AbbVie (ABBV), Alibaba (BABA), Berkshire Hathaway (BRK.B), Chevron (CVX), ExxonMobil (XOM)

Source: Zacks.com, October 25, 2019

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame, and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

 


Q U O T E   O F   T H E   W E E K

“Lack of money is no obstacle. Lack of an idea is an obstacle.”

KEN HAKUTA

 


 

T H E   W E E K L Y   R I D D L E

Round like an apple and deeper than a cup, yet all the king’s horses can’t pull it up. What is it?

 

LAST WEEK’S RIDDLE: It falls from great heights, but it never stays, and sometimes people wish it would go away. What is it?

ANSWER: Rain.

 


This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

CITATIONS:

1 – marketwatch.com/story/us-stock-futures-step-cautiously-higher-setting-investors-up-for-fresh-run-at-records-2019-10-25 [10/25/19]

2 – wsj.com/market-data [10/25/19]   

3 – quotes.wsj.com/index/XX/990300/historical-prices [10/25/19]

4 – reuters.com/article/us-usa-trade-china/u-s-china-close-to-finalizing-parts-of-phase-1-trade-pact-ustr-idUSKBN1X40EF [10/25/19]

5 – investing.com/economic-calendar/michigan-consumer-sentiment-320 [10/25/19]

 

CHART CITATIONS:

wsj.com/market-data [10/25/19]

quotes.wsj.com/index/XX/990300/historical-prices [10/25/19]

quotes.wsj.com/index/SPX/historical-prices [10/25/19]

treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield [10/25/19]

treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldAll [10/25/19]