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Weekly Economic Update 07-23-2012

July 24, 2012

NO ADVANCE IN CONSUMER PRICES

The federal government’s Consumer Price Index was flat in June, though the core CPI (minus food and energy prices) did rise 0.2%. Statistically, this was exactly what economists surveyed by MarketWatch had expected. Annualized inflation was running at 3.9% back in September; it was just 1.7% in both May and June.1

HOUSING INDICATORS REGISTER HIGHS & LOWS

According to the Commerce Department, housing starts were up 6.9% for June to the highest level since October 2008. The average interest rate on the 30-year FRM fell to a new record low of 3.53% in Freddie Mac’s July 19 survey, as did the average rate on the 15-year FRM (2.83%). Existing home sales, however, slipped badly in June – the National Association of Realtors said the sales volume slowed 5.4% to a pace unseen in nine months. Sales were still 4.5% improved from a year before.2

RETAIL SALES SLIP 0.5% in JUNE

They have now declined for three straight months, and a retreat of that length hasn’t been recorded by the Commerce Department since July-December 2008. Analysts polled by Bloomberg News had forecast an increase of at least 0.2%.3

STOCKS SLIP FRIDAY BUT GAIN FOR THE WEEK

Spain’s projection of recession into 2013 sent European shares down about 1% on Friday, with yields on Spanish bonds topping 7%. The Dow fell 121 points on the day, but on the week it rose 0.36% to close at 12,822.57 Friday. The NASDAQ (+0.58% to 2,925.30) and S&P 500 (+0.43% to 1,362.66) also posted five-day gains. After a 4.98% weekly gain, NYMEX crude settled Friday at $91.44 per barrel.4,5

THIS WEEK: Earnings season is in full swing, with McDonalds, Hasbro, Baidu, Halliburton and Texas Instruments offering results Monday. Tuesday, Q2 results are in from Apple, Broadcom, DuPont, UPS, Aflac and AT&T. Wednesday, the Census Bureau publishes June new home sales data and Ford, ConocoPhillips, Symantec, PepsiCo, Bristol-Myers, GlaxoSmithKline, Western Digital, Boeing, Caterpillar, VISA, WholeFoods and Zynga issue earnings reports. On Thursday, new initial claims figures are in along with the latest pending home sales report from the NAR and data on hard goods orders in June; earnings arrive from ExxonMobil, 3M, Pulte, Sprint, Expedia, Amazon.com, Starbucks, Amgen, Facebook, Dow Chemical, AstraZeneca and Credit Suisse, and a Commodity Futures Trading Commission emergency meeting will be held in response to the PFGBest scandal. Friday brings the final University of Michigan consumer sentiment survey for July, the second estimate of Q2 GDP and earnings from Barclays, Merck, DR Horton and Chevron.

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+4.95

+1.99

-1.49

+5.99

NASDAQ

+12.29

+3.95

+1.77

+12.18

S&P 500

+8.35

+2.78

-2.24

+6.07

REAL YIELD

7/20 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

-0.67%

0.62%

2.60%

3.10%

 

Sources: money.msn.com, bigcharts.com, treasury.gov, treasurydirect.gov – 7/20/124,6,7,8

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends

 

This material was prepared by Peter Montoya Inc, and does not necessarily represent the views of John Jastremski, and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.


The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com, access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may
be reached at http://www.theretirementgroup.com.

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