Clarksville Weekly Market Snapshot from Frazier Allen for the week of September 27th, 2015

Clarksville, TN – In Janet Yellen’s first public speech after the recent FOMC meeting, the Fed chair downplayed concerns about the rest of the world and placed herself among the majority of Fed officials expecting to raise short-term interest rates by the end of the year. In a scary moment for investors, Yellen struggled to finish her speech.

She repeatedly lost her place, paused for long periods, and looked generally unwell. She received medical treatment. A Fed spokesperson said that she was dehydrated and that she felt fine later. While stock market participants have been worried about Fed tightening, they seemed to have been more encouraged by Yellen’s expressed confidence in the U.S. economy.

The economic data were mixed. Real GDP was reported to have risen at a 3.9% annual rate in 2Q15 (vs. +3.7% in the previous estimate). Private Domestic Final Sales (GDP less net exports, the change in inventories, and government) rose at a 3.9% pace (revised from +3.3%), up 3.5% from a year ago (a strong trend in growth in underlying domestic demand).

Next week, a number of important economic reports will arrive. Figures are likely to remain consistent with some softness abroad, but continued strength in the domestic economy. However, the release of the employment report may be delayed if we have a government shutdown. Congress must come up with a continuing resolution to fund the government into the new fiscal year and appears to be close to a stalemate.

Even if a deal can be worked out on the budget, another showdown looms over raising the federal debt ceiling. A shutdown is unlikely to have much of an impact on the overall economy, but uncertainty may undermine investor confidence.

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 September 24th, 2015.

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