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Weekly Market Snapshot from Frazier Allen for the week of April 21st, 2013

 

Weekly Market Snapshot

Market Commentary by Scott J. Brown, Ph.D., Chief Economist

Scott J. Brown Ph.D., Chief Economist Raymond James Investment ServicesThe terrorist bombing at the Boston Marathon and news of ricin-laced letters mailed to elected officials did not appear to have a major impact on the financial markets, but they certainly didn’t help. The major stock market averages were volatile. Bond yields remained low. Commodity prices remained under pressure.

Economic data were mixed, but generally weak. The Fed’s Beige Book noted that anecdotal reports from late February to early April were consistent with moderate economic growth. The Index of Leading Economic Indicators edged lower. Industrial production rose more than expected, but that was due to a jump in utility output (colder temperatures). Factory output fell modestly in March, with strength in autos, but weak otherwise. Seasonal adjustment led to a drop in gasoline prices, pushing the headline Consumer Price Index lower in March, while core inflation rose modestly.

Next week, reports on home sales and durable goods orders have the potential to surprise. Housing should continue to recover, but there may be supply issues in the short run. A relapse in orders at Boeing should have pushed overall orders down in March. Ex-transportation, orders are likely to have been mixed, but generally lackluster.

The advance estimate of GDP is always an adventure. The government doesn’t have March figures on trade, inventories, and other components, and will have to guestimate. More importantly, the 1Q13 GDP figures don’t tell us anything about growth in the current quarter and beyond.

Indices

  Last Last Week YTD return %
DJIA 14537.14 14865.14 10.94%
NASDAQ 3166.36 3300.16 4.86%
S&P 500 1541.61 1593.37 8.09%
MSCI EAFE 1667.67 1724.04 3.97%
Russell 2000 901.51 947.05 6.14%

Consumer Money Rates

  Last 1-year ago
Prime Rate 3.25 3.25
Fed Funds 0.15 0.15
30-year mortgage 3.41 3.90

Currencies

  Last 1-year ago
Dollars per British Pound 1.530 1.602
Dollars per Euro 1.308 1.312
Japanese Yen per Dollar 98.110 81.230
Canadian Dollars per Dollar 1.025 0.991
Mexican Peso per Dollar 12.268 13.150

Commodities

  Last 1-year ago
Crude Oil 87.73 102.67
Gold 1390.73 1639.45

Bond Rates

  Last 1-month ago
2-year treasury 0.23 0.25
10-year treasury 1.70 1.91
10-year municipal (TEY) 2.98 3.32

Treasury Yield Curve – 04/19/2013

Treasury Yield Curve – 04/19/2013

S&P Sector Performance (YTD) – 04/19/2013

S&P Sector Performance (YTD) – 04/19/2013

Economic Calendar

April 22nd

 —

Existing Home Sales (March)
April 23rd

 —

New Home Sales (March)
April 24th

 —

Durable Goods Orders (March)
April 25th

 —

Jobless Claims (week ending April 20th)
April 26th

 —

Real GDP (1Q13, advance)
Consumer Sentiment (April)
April 29th

 —

Personal Income and Spending (March)
Pending Home Sales Index (March)
April 30th

 —

Consumer Confidence (April)
May 1st

 —

ISM Manufacturing Index (April)
FOMC Policy Decision (no press briefing)
May 3rd

 —

Employment Report (April)
ISM Non-Manufacturing Index (April)

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 4th, 2013.

©2013 Raymond James Financial Services, Inc. member FINRA / SIPC.


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