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Clarksville Weekly Market Snapshot from Frazier Allen for the week of August 21st, 2016

By Frazier Allen | August 21, 2016 |

F&M Investment Services - Raymond James - Clarksville, TN Clarksville, TN – The FOMC minutes (from the July 26th-27th policy meeting) showed that officials were divided on the timing of the next rate hike. Some felt that the labor market had already tightened enough and that the Fed risked generating financial excesses by keeping rates so low for so long.

Others felt that there was plenty of time to wait for more information and that it would be harder to correct course if the Fed moved too rapidly. Among voting FOMC members, the hawkish view (those wanting to raise rates sooner rather than later) appeared to be a minority.

Frazier Allen

Industrial production rose more than expected in July, boosted by hot weather (increased output of utilities) and a possible seasonal adjustment quirk in autos (more muted plant closings this year).

Oil and gas well drilling, down 75% since late 2015, rose 4.9% (suggesting a possible bottom in energy exploration).

Consumer price inflation was a bit lower than expected (ex-food, energy and shelter, the CPI rose 1.4% y/y).

Next week, market participants may react to any surprises in the economic data reports, but there’s nothing that will significantly alter the overall economic picture. The focus will be on Janet Yellen’s Jackson Hole speech.

The Fed chair may not provide any definitive clues on what policymakers will do at the September 20th-21st policy meeting. Rather, she is set to examine the variety of tools that the Fed has used during the recession and recovery.

Indices

	Last	Last Week	YTD return %
DJIA	18597.70	18613.52	6.73%
NASDAQ	5240.15	5228.40	4.65%
S&P 500	2187.02	2185.79	7.00%
MSCI EAFE	1707.90	1708.32	-0.49%
Russell 2000	1236.85	1229.12	8.89%

Consumer Money Rates

	Last	1 year ago
Prime Rate	3.50	3.25
Fed Funds	0.40	0.14
30-year mortgage	3.41	3.93

Currencies

	Last	1 year ago
Dollars per British Pound	1.317	1.568
Dollars per Euro	1.135	1.112
Japanese Yen per Dollar	99.89	123.80
Canadian Dollars per Dollar	1.278	1.313
Mexican Peso per Dollar	18.189	16.621

Commodities

	Last	1 year ago
Crude Oil	48.22	40.80
Gold	1357.20	1127.90

Bond Rates

	Last	1 month ago
2-year treasury	0.73	0.71
10-year treasury	1.56	1.58
10-year municipal (TEY)	2.18	2.26

Treasury Yield Curve – 08/19/2016

As of close of business 08/18/2016

Economic Calendar

August 23	—	New Home Sales (July)
August 24	—	Existing Home Sales (July)
August 25	—	Jobless Claims (week ending August 20) Durable Goods Orders (July)
August 26	—	Real GDP (2Q16, 2nd estimate) Yellen Jackson Hole speech

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 August 18th, 2016.

About Frazier Allen

Frazier Allen

Frazier Allen, WMS, CRPS, Financial Advisor with F&M Bank
50 Franklin Street | Clarksville, TN 37040 | 931-553-2048

Web Site: http://www.raymondjames.com/frazierallen
Email:

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