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Clarksville Weekly Market Snapshot from Frazier Allen for the week of February 15th, 2015

F&M Investment Services - Raymond James - Clarksville, TNClarksville, TN – As expected, U.S. financial market participants kept a close eye on developments in Europe. A fragile ceasefire agreement was reached in Ukraine (but we’ve seen that before). Negotiations to reduce austerity in Greece and restructure the country’s debt broke down without making much progress, but the two sides agreed to try again next week.

Retails sales were softer than expected in January and consumer sentiment fell unexpectedly in the mid-February assessment, leading to some concerns about the strength of consumer spending, but also fueling expectations that the Fed will delay its initial increase in short-term interest rates. Unadjusted core retail sales fell 24.9%, the same decline as in January 2014.

Frazier Allen
Frazier Allen

Next week, the important economic data reports bunch up on Wednesday. January residential construction data should not be important (the bigger test will come in the spring), but seasonal adjustment could exaggerate.

The Fed has signaled that it can be patient in deciding when to begin raising short-term interest rates. However, some officials are more patient than others. That division should be apparent in the minutes of the January policy meeting, and there’s some chance that the wire services (and the financial markets) will take some quote out of context and overreact.

Yet, market participants ought to reserve judgment. Fed Chair Janet Yellen will likely provide more clarity when she testifies to the Senate Banking Committee on February 24th.

Indices

Last Last Week YTD return %
DJIA 17972.38 17884.88 0.84%
NASDAQ 4857.61 4765.10 2.57%
S&P 500 2088.48 2062.52 1.44%
MSCI EAFE 1822.82 1820.75 2.70%
Russell 2000 1216.27 1208.71 0.96%

Consumer Money Rates

Last 1 year ago
Prime Rate 3.25 3.25
Fed Funds 0.13 0.06
30-year mortgage 3.69 4.28

Currencies

Last 1 year ago
Dollars per British Pound 1.532 1.654
Dollars per Euro 1.134 1.364
Japanese Yen per Dollar 119.790 102.430
Canadian Dollars per Dollar 1.256 1.099
Mexican Peso per Dollar 15.030 13.275

Commodities

Last 1 year ago
Crude Oil 51.21 100.37
Gold 1223.33 1287.08

Bond Rates

Last 1 month ago
2-year treasury 0.62 0.44
10-year treasury 2.02 1.75
10-year municipal (TEY) 3.14 3.01

Treasury Yield Curve – 02/13/2015

Treasury Yield Curve – 02/13/2015

S&P Sector Performance (YTD) – 02/13/2015

S&P Sector Performance (YTD) – 02/13/2015

Economic Calendar

February 16th — Presidents Day holiday (markets closed)
February 17th — Empire State Manufacturing Index (February)
February 18th — Producer Price Index (January)
Building Permits, Housing Starts (January)
Industrial Production (January)
FOMC Minutes (January 27th-28th)
February 19th — Jobless Claims (week ending February 14th)
Philadelphia Fed Index (February)
Leading Economic Indicators (January)
February 23rd — Existing Home Sales (January)
February 24th — Consumer Confidence (February)
Yellen Monetary Policy Testimony (tentative)

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 February 12th, 2015.

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

Frazier Allen
Frazier Allenhttp://www.raymondjames.com/frazierallen
Frazier Allen, WMS, CRPS, Financial Advisor with F&M Bank 50 Franklin Street | Clarksville, TN 37040 | 931-553-2048
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