Clarksville Weekly Market Snapshot from Frazier Allen for the week of October 28th, 2015

Clarksville, TN – The economic calendar was light. Residential construction figures were mixed, largely reflecting the usual noise in the multi-family sector data (single-family starts and permits were little changed and still up strongly from a year ago). Existing home sales rebounded from a surprise drop in August. The four-week average for jobless claims fell to the lowest level since 1973.

Earnings reports were mixed, but investors appeared to be encouraged by the view that economic growth will continue, but not so fast that the Federal Reserve rushes to take away the punch bowl.

The European Central Bank left monetary policy unchanged, but ECB President Mario Draghi signaled a possible expansion of the asset purchase program at the meeting in early December. That news sent the euro sharply lower against the greenback. The People’s Bank of China reduced short-term interest rates for the sixth time since last November and lowered the reserve requirement ratio.

A majority of the Freedom Caucus members in the U.S. House agreed to line up behind Paul Ryan as speaker. Congress needs to raise the debt ceiling by November 3rd. Treasury delayed the upcoming auction of 2-year notes due to concerns about the debt ceiling.

Next week, nothing much is expected from the Fed policy meeting. There is no press conference with Chair Janet Yellen; no revision of Fed projections. Instead, investors will look to minor changes in the wording of the policy statement to gauge the likelihood of a move at the mid-December meeting.

The advance estimate of 3Q15 GDP growth is expected to be mixed – domestic strength offset by large drags from net exports and slower inventory growth. The Employment Cost Index will be seen as a possible driver of Fed policy action.

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.

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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 October 22nd, 2015.

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