Peek of the Week
December 1, 2015
The
Markets
American markets were relatively quiet during Thanksgiving
week but there were fireworks in China’s markets.
Late in the week, media outlets reported the China
Securities Regulatory Commission was conducting inquiries into several securities
firms as part of an anti-corruption crackdown triggered by last summer’s wild
market gyrations. The news sizzled through China’s stock markets. The Financial Times wrote:
“It's like a trip down memory lane… if memory lane was
vertical… The Shanghai Composite was down by as much as 6.1 percent in late
trade, with the tech-focused Shenzhen Composite following suit, down by as much
as 6.8 percent. It would be Shanghai's biggest one-day fall since August 25,
when the benchmark slumped by 7.7 percent, writes Peter Wells in Hong Kong.”
U.S. markets were sanguine, in part, because there was
little activity on Friday, according to The
Wall Street Journal. It also may have something to do with an upward
revision in third quarter’s gross domestic product (GDP), which measures the
value of all goods and services produced in the United States. On Tuesday, the U.S.
Commerce Department reported GDP increased at an annual rate of 2.1 percent
during the third quarter, an improvement over the initial estimate of 1.5
percent.
Next week may be a doozy. The European Central Bank is
expected to introduce additional monetary easing measures, while the U.S. Federal
Reserve provides additional clues about the timing of its monetary tightening
measures, said The Wall Street Journal.
We’ll also get news about U.S. home sales, automobile sales, chain store sales,
factory orders, and employment. It’s likely to be an interesting week.
Data as of 11/27/15
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
|
Standard &
Poor's 500 (Domestic Stocks)
|
0.1%
|
1.5%
|
1.1%
|
14.3%
|
12.0%
|
5.2%
|
|
Dow Jones Global
ex-U.S.
|
-0.8
|
-4.7
|
-7.9
|
2.2
|
0.8
|
1.3
|
|
10-year Treasury
Note (Yield Only)
|
2.2
|
NA
|
2.2
|
1.7
|
2.8
|
4.4
|
|
Gold (per ounce)
|
-2.3
|
-11.8
|
-11.5
|
-15.4
|
-4.9
|
7.9
|
|
Bloomberg Commodity Index
|
-0.4
|
-22.3
|
-28.2
|
-17.4
|
-11.2
|
-6.8
|
|
DJ Equity All REIT Total Return Index
|
0.9
|
2.2
|
3.5
|
12.0
|
12.4
|
7.3
|
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg
Commodity Index returns exclude reinvested dividends (gold does not pay a
dividend) and the three-, five-, and 10-year returns are annualized; the DJ
Equity All REIT Total Return Index does include reinvested dividends and the
three-, five-, and 10-year returns are annualized; and the 10-year Treasury
Note is simply the yield at the close of the day on each of the historical time
periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com,
London Bullion Market Association.
Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not
applicable.
it seems that shopping has joined food, football, and family as a favorite pastime on Thanksgiving Day.
Did you log on and do a
little holiday shopping last Thursday while your holiday feast was cooking? If
so, you are not alone. MarketWatch
reported consumers spent $1.1 billion between midnight and 5:00 p.m. eastern
time on Thanksgiving Day. That was a 22 percent increase over the year before.
After taking a break to give
thanks, gorge on Thanksgiving delicacies, and enjoy family time, consumers
fired up their devices again – more than one-third of sales were made via smart
phone or tablet – for round two in the online shopping arena. On Friday, between
midnight and 11:00 a.m. eastern time, they spent another $822 million. That’s
15 percent more than last year. In total, Black Friday sales were expected to
be about $2.6 billion.
By Friday morning, out-of-stock
rates were reported to be double the level they normally reach this time of
year. So, prepare for the possibility shoppers may be rabidly seeking more than
one extremely popular gift item as we head deeper into the holiday shopping
season.
That’s a more welcome turn of
events than 1953’s glut of unsold turkeys. The
Fiscal Times reported Swanson got started in the frozen dinner
manufacturing business when it finished Thanksgiving with 260 tons of extra
turkeys. Its solution was to package sliced turkey with trimmings on aluminum
trays. In 1954, the company sold 10 million frozen turkey dinners and a new
industry was born.
Since investors were
concerned about weaker than expected retail sales just a couple of weeks ago, if
retail spending continues to be strong in coming weeks, it could affect investors’
confidence and outlook.
Weekly Focus –
Think About It
“My first rule of consumerism is never to buy anything
you can’t make your children carry.”
--Bill Bryson, American author
Best
regards,
Leif M. Hagen
Leif M. Hagen, CLU, ChFC
LP Financial Advisor
Securities
offered through LPL Financial Inc.,
Member
FINRA/SIPC.
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* This newsletter was
prepared by Peak Advisor Alliance. Peak Advisor Alliance is not affiliated with
the named broker/dealer.
* The Standard & Poor's
500 (S&P 500) is an unmanaged group of securities considered to be
representative of the stock
market in general. You cannot invest directly in this index.
* The Standard & Poor’s
500 (S&P 500) is an unmanaged index. Unmanaged index returns do not reflect
fees,
expenses, or sales charges.
Index performance is not indicative of the performance of any investment.
* The 10-year Treasury Note
represents debt owed by the United States Treasury to the public. Since the
U.S.
Government is seen as a
risk-free borrower, investors use the 10-year Treasury Note as a benchmark for
the long-term bond market.
* Gold represents the
afternoon gold price as reported by the London Bullion Market Association.
The gold price is set twice
daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in
U.S. dollars per fine troy ounce.
* The Bloomberg Commodity
Index is designed to be a highly liquid and diversified benchmark for the
commodity futures market. The Index is composed of futures contracts on 19
physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT
Total Return Index measures the total return performance of the equity
subcategory of the Real Estate Investment Trust (REIT) industry as calculated
by Dow Jones.
* Yahoo! Finance is the
source for any reference to the performance of an index between two specific
periods.
* Opinions expressed are
subject to change without notice and are not intended as investment advice or
to predict future performance.
* Economic forecasts set
forth may not develop as predicted and there can be no guarantee that strategies
promoted will be successful.
* Past performance does not
guarantee future results. Investing involves risk, including loss of principal.
* You cannot invest directly
in an index.
* Consult your financial
professional before making any investment decision.
* Stock investing involves
risk including loss of principal.
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Sources:
http://www.ft.com/intl/fastft/432211/chinese-stocks-dive-5-afternoon-trade (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/11-30-15_FinancialTimes-Chinese_Stocks_Dive_6_Percent_on_Brokerage_Investigations-Footnote_2.pdf)
http://www.wsj.com/articles/global-stocks-fall-as-china-halts-europes-rally-1448615945 (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/11-30-15_WSJ-Dow_Ends_Slightly_Lower_in_Shortened_Session-Footnote_3.pdf)
http://www.barrons.com/mdc/public/page/9_3063-economicCalendar.html (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/11-30-15_Barrons-2015_Economic_Calendar-Footnote_5.pdf)
