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

Clarksville, TN – The economic data calendar was relatively thin, leaving stock market investors to fret about a likely December rate hike from the Fed. A 25-basis-point increase in short-term interest rates should not have much of an impact on the economy, especially if the Fed follows up very gradually (as anticipated).

However, the financial markets see the initial tightening move as a big deal, so it is. Weak earnings results haven’t helped, but most of the weakness is tied to the strong dollar and slower growth abroad.

However, the trend isn’t horrible (slower, but still positive). The Producer Price data surprised to the downside, reflecting a further drop in food prices and a decline in the core index. Pipeline pressures (inflation figures for the earlier stages of production) remained negative.

Next week, the data on industrial production and residential construction will help fill in the economic picture, but investors are more likely to focus on the FOMC minutes. Those minutes should show Fed officials leaning toward a December rate hike.

We should get some color on why officials are set to hike (expectations of less slack a year from now) and what it would take for the Fed to delay (bad economic data or significant financial market disruptions).

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 November 12th, 2015.

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