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Clarksville Weekly Market Snapshot from Frazier Allen for the week of May 19th, 2014

 

F&M Investment Services - Raymond James - Clarksville, TNClarksville, TN – Concerns about the economic recovery at home and abroad helped pushed long-term interest rates lower (with the 10-year Treasury yield below 2.5%). Stocks fell broadly.

The economic data were mixed. April retail sales and industrial production disappointed, but there were upward revisions to previous figures. Building permits and housing starts jumped sharply in April, but strength was concentrated in the volatile multi-family sector.

Single-family construction activity improved only modestly. The Consumer Price Index rose in line with expectations, reflecting higher prices of food and gasoline. A jump in airline fares added to the core CPI.

Frazier Allen

Frazier Allen

The Producer Price Index rose more than anticipated, but the gauges for the earlier stages of production suggested limited inflation pressure within the pipeline. Import prices fell. Consumer sentiment fell short of expectations in the mid-month reading for May.

Next week, the economic calendar is relatively thin. We’re unlikely to get any new revelations from the FOMC minutes, but there’s always a chance that the financial markets will take something out of context and run with it.

Given Fed Chair Yellen’s concerns about the housing recovery, the home sales figures will likely receive a lot more scrutiny than usual (but bear in mind that the new home sales figures are erratic and unreliable). The bond market will close early on Friday ahead of the three-day weekend.

Indices

Last Last Week YTD return %
DJIA 16446.81 16550.97 -0.78%
NASDAQ 4069.29 4051.50 -2.57%
S&P 500 1870.85 1875.63 1.22%
MSCI EAFE 1937.72 1944.74 1.15%
Russell 2000 1095.99 1097.43 -5.81%

Consumer Money Rates

Last 1-year ago
Prime Rate 3.25 3.25
Fed Funds 0.07 0.12
30-year mortgage 4.20 3.51

Currencies

Last 1-year ago
Dollars per British Pound 1.679 1.521
Dollars per Euro 1.371 1.286
Japanese Yen per Dollar 101.580 102.510
Canadian Dollars per Dollar 1.088 1.018
Mexican Peso per Dollar 12.928 12.258

Commodities

Last 1-year ago
Crude Oil 101.50 94.30
Gold 1295.65 1395.78

Bond Rates

Last 1-month ago
2-year treasury 0.36 0.39
10-year treasury 2.51 2.67
10-year municipal (TEY) 3.72 4.32

Treasury Yield Curve – 5/16/2014

Treasury Yield Curve – 5/16/2014

S&P Sector Performance (YTD) – 5/16/2014

S&P Sector Performance (YTD) – 5/16/2014

Economic Calendar

May 21st FOMC Minutes (April 29th-30th)
May 22nd Jobless Claims (week ending May 17th)
Existing Home Sales (April)
Leading Economic Indicators (April)
May 23rd New Home Sales (April)
May 26th Memorial Day Holiday (markets closed)
May 27th Durable Goods Orders (April)
Case-Shiller Home Price Index (March)
Consumer Confidence (May)
May 29th Real GDP (1Q14, 2nd estimate)
Pending Home Sales Index (April)
May 30th Personal Income and Spending (April)
Chicago PM Index (May)

 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 May 8th, 2014.

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


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