INFLATION PRESSURE WEAKENS
The Consumer Price Index was unchanged in June, according to the Bureau of Labor Statistics. That left its yearly advance at only 1.6%, nearly half a point below the Federal Reserve’s target (the core CPI was up 1.7%). After the announcement, some economists and market strategists wondered whether the Fed would rethink its plans for a third interest rate hike in 2017. The Producer Price Index rose 0.1% in June, leaving its yearly increase at 2.0%.1,2
RETAIL SALES, CONSUMER SENTIMENT INDEX DECLINE
For the second month in a row, households scaled back their retail purchases – retail sales were down 0.2% in June following a 0.1% May decline. Core sales fell 0.2% after a May retreat of 0.3%. The University of Michigan’s preliminary July consumer sentiment index lost 2.0 points off its final June mark to a reading of 93.1.1,2
A projection of rising demand and news of a pipeline shutdown in Nigeria sent the price of light sweet crude 5.2% higher in a week. WTI crude settled at $46.54 on the NYMEX Friday, its best close since July 3.3
DOW ENTERS RECORD TERRITORY AGAIN
Friday, the Dow 30 notched its third straight record close: 21,637.74. At the same time, the S&P 500 also settled at a new record of 2,459.27. The Nasdaq Composite finished Friday’s market day at 6,312.47, a half-percent away from its all-time peak. For the week, the Dow rose 1.04%; the S&P, 1.41%; the Nasdaq, 2.59%.4,5
THIS WEEK AT A GLANCE:
- Monday: earnings report includes announcements from BlackRock, Charles Schwab, J.B. Hunt, and Netflix.
- Tuesday: Wall Street examines earnings from Bank of America, CSX, Comerica, Goldman Sachs, Harley-Davidson, IBM, Johnson & Johnson, Lockheed Martin, TD Ameritrade, and UnitedHealth Group.
- Wednesday: data on June housing starts and building permits, plus earnings from American Express, Fidelity National Financial, Morgan Stanley, Northern Trust, Qualcomm, T-Mobile, U.S. Bancorp, United Rentals, and W.W. Grainger. A new weekly initial claims report arrives
- Thursday: new weekly initial claims report arrives plus earnings news from Abbott Labs, Alliance Data Systems, American Airlines Group, BB&T, BoNY Mellon, Capital One, Cintas, eBay, E*TRADE, GATX, KeyCorp, Microsoft, NCR, Nucor, Philip Morris, Sherwin-Williams, Skechers, Snap-On, Travelers Companies, Union Pacific, Visa, and Whirlpool.
- Friday: Colgate-Palmolive, Fifth Third Bancorp, General Electric, Honeywell International, Regions Financial, Schlumberger, and SunTrust Banks present earnings.
1 – cnbc.com/2017/07/14/lack-of-inflation-raises-new-doubts-about-fed-ability-to-hike-interest-rates-this-year.html [7/14/17]
2 – investing.com/economic-calendar/ [7/14/17]
3 – marketwatch.com/story/oil-gains-pause-but-optimism-remains-after-iea-report-2017-07-14 [7/14/17]
4 – money.cnn.com/2017/07/14/investing/dow-record-trump-rally-wall-street/index.html [7/14/17]
5 – markets.wsj.com/us [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F14%2F16&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F14%2F16&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F14%2F16&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F13%2F12&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F13%2F12&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F13%2F12&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F13%2F07&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F13%2F07&x=0&y=0 [7/14/17]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F13%2F07&x=0&y=0 [7/14/17]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [7/14/17]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [7/14/17]
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