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Clarksville Weekly Market Snapshot from Frazier Allen for the week of April 29th, 2014

 

F&M Investment Services - Raymond James - Clarksville, TNClarksville, TN – March home sales figures were disappointing and while the numbers are normally choppy, suggested that there may be something more to the slowdown in housing than bad weather (mortgage rates are higher than a year ago, while prices have risen significantly over the last three years).

Next week, it’s a very busy calendar, with fresh figures for April. Consumer confidence is expected to pick up. Real GDP growth is likely to be relatively soft (0.4% to +1.4%), with a weather-related restraint on consumer spending and homebuilding, drags from slower inventory growth and a wider trade deficit, and a rebound in government (following the drag from the shutdown in 4Q13).

Frazier Allen

Frazier Allen

Note that this is the advance estimate and an incomplete picture (figures will be revised, and revised again). Note that much of the monthly economic data series point to much stronger growth in 2Q14 (largely reflecting a rebound from bad weather).

The ISM Manufacturing Index is likely to improve (still moderate). Motor vehicle sales are expected to remain strong.

The April Employment Report is likely to show somewhat stronger growth in nonfarm payrolls and a decline in the unemployment rate (but note that the Fed is considering a wide range of labor market indicators).

On Wednesday, the Federal Open Market Committee is expected to reduce the monthly rate of asset purchases by another $10 billion (to $45 billion). We should see little change in the wording of the policy statement. There will be no post-meeting press briefing.

Indices

  Last Last Week YTD return %
DJIA 16501.65 16170.22 -0.45%
NASDAQ 4148.34 4054.106 -0.68%
S&P 500 1878.61 1833.08 1.64%
MSCI EAFE 1927.38 1919.80 0.61%
Russell 2000 1144.35 1127.66 -1.66%

Consumer Money Rates

  Last 1-year ago
Prime Rate 3.25 3.25
Fed Funds 0.08 0.14
30-year mortgage 4.33 3.40

Currencies

  Last 1-year ago
Dollars per British Pound 1.679 1.526
Dollars per Euro 1.382 1.301
Japanese Yen per Dollar 102.360 99.420
Canadian Dollars per Dollar 1.103 1.028
Mexican Peso per Dollar 13.099 12.295

Commodities

  Last 1-year ago
Crude Oil 102.24 91.06
Gold 1289.94 1423.76

Bond Rates

  Last 1-month ago
2-year treasury 0.43 0.45
10-year treasury 2.67 2.70
10-year municipal (TEY) 4.32 4.45

Treasury Yield Curve – 4/25/2014

Treasury Yield Curve – 4/25/2014

S&P Sector Performance (YTD) – 4/25/2014

S&P Sector Performance (YTD) – 4/25/2014

Economic Calendar

April 28th  — Pending Home Sales Index
April 29th  — Consumer Confidence (April)
April 30th  — ADP Payroll Estimate (April)
Real GDP (1Q14, advance estimate)
FOMC Policy Decision (no press conference)
May 1st  — Jobless Claims (week ending April 26th)
Personal Income and Spending (March)
ISM Manufacturing Index (April)
Motor Vehicle Sales (April)
May 2nd  — Employment Report (April)
May 13th  — Retail Sales (April)
June 18th  — FOMC Policy Decision, Yellen Press Conference

Important Disclosures

Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business April 24th, 2014.

©2014 Raymond James Financial Services, Inc. member FINRA / SIPC.


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