Market Commentary, 08/07/17

LAST WEEK:

1. The major indexes finished the week mixed; +1.2% for the Dow; +0.19% for the S&P 500 and -0.36% for the Nasdaq.

2. The US created an impressive 209,000 new jobs in July. It should be noted, however, that a large portion of these positions were part-time.

3. The number of employed Americans hit a new high of 153.5 million.

4. The unemployment rate, 4.3%, remains at its lowest rate in almost 16 years. The more encompassing U-6 unemployment rate (which includes discouraged workers and the underemployed) remained unchanged at 8.6%, near a 10 year low.

5. Americans increased their spending by only 0.1%, slowing to its weakest performance in seven months, according to the Commerce Department. This is important because consumer spending accounts for 70% of US economic activity.

6. Manufacturing slowed slightly last month but still remained near “exceptionally strong” levels according to the Institute for Supply Management (ISM) manufacturing index.

The numbers above suggest:

• A strong labor market with solid job gains and faster wage growth.
• Layoffs remain near 10-year lows.
• Most people who want a job can get one.

Last Week’s Miscellaneous Matters:

• Last week, wage growth increased, indicating a gradual rise in inflation.
• In spite of two 2017 Fed rate increases, long-term yields remain low.

Rising corporate earnings and news of an improving job market helped stocks post fresh highs last week as both the Dow and S&P 500 passed 10% gains on the year. Looking ahead, hundreds of companies will post second-quarter reports over the next few days (e.g., Disney, Macy’s, CBS, Nordstrom, 21st Century Fox).

Regards,

Jeremiah Patterson, CFP®
Copelin Financial Advisors
514 Brooks Street
Sugar Land, TX 77478
Phone: 281 240-2902
Fax: 281 240-2856
jeremiah@copelinfinancial.com

Advisory Services offered through Investment Advisors, a division of ProEquities, Inc., a Registered Investment Advisor. Securities offered through ProEquities, Inc., a Registered Broker/Dealer and Member of FINRA & SIPC. Copelin Financial Advisors, Inc. is independent of ProEquities, Inc.

Source – W E Sherman & Co., LLC