Last week the market was slightly up after a very strong first half of 2017. The second half of 2017 will likely be impacted by what Congress does or doesn’t do with regulations and taxes.
Hiring Picks Up Again
The Department of Labor announced some good news Friday: the creation of 222,000 net new jobs in June, the largest hiring gain in four months. Approximately 4.7 million people reentered the labor force and found work in June, a peak unmatched in 27 years of monthly data. Wages rose 0.2% for an annualized gain of 2.5%. The main unemployment rate ticked north to 4.4% as more Americans joined the job hunt; the U-6 rate, including the underemployed, increased 0.2% to 8.6%, its first rise since January.1
ISM Factory PMI Hits 3-Year Peak
In June, the Institute for Supply Management’s globally watched manufacturing purchasing manager index improved 2.9 points to 57.8, its highest reading since August 2014. ISM’s non-manufacturing PMI rose to 57.4 after a half-point gain; its June reading signaled the 90th straight month of expansion for the country’s service sector.2,3
Gold Settles at its Lowest Price Since March
The yellow metal fell to a COMEX close of $1,209.70 Friday. It is now on a 5-week losing streak. The price of gold sank 2.6% last week, while the price of silver dropped 6.9%; silver ended the week down at $15.43.4
Major Indices Make Small Weekly Gains
Across a stretch of choppy trading days, the S&P 500 added just 0.07% to close at 2,425.18 Friday. The Nasdaq Composite and Dow Jones Industrial Average posted respective, 5-day advances of 0.21% and 0.30%. The Nasdaq wrapped up Friday’s market day at 6,153.08; the Dow, at 21,414.34.5
Monday, Barracuda Networks and WD-40 present earnings. On Tuesday, earnings appear from PepsiCo and Yum! Brands. Wednesday, Federal Reserve chair Janet Yellen visits Capitol Hill to begin two days of testimony on monetary policy in Congress; in addition, the Fed releases a new Beige Book, and Fastenal reports Q2 results. Thursday, Wall Street considers a new initial jobless claims report, plus the June Producer Price Index. On Friday, a river of data arrives: a new earnings season begins with announcements from Citigroup, JPMorgan Chase, PNC Financial Services Group, and Wells Fargo, complementing the initial July University of Michigan consumer sentiment index, the June Consumer Price Index, and June retail sales and industrial production reports.
|% CHANGE||YTD||1-YR CHG||5-YR AVG||10-YR AVG|
|REAL YIELD||7/7 RATE||1 YR AGO||5 YRS AGO||10 YRS AGO|
|10 YR TIPS||0.66%||-0.03%||-0.53%||2.79%|
Sources: wsj.com, bigcharts.com, treasury.gov – 7/7/175,6,7,8
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.
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- 1 – bloomberg.com/news/articles/2017-07-07/wage-weakness-amid-solid-hiring-adds-to-u-s-economic-puzzle [7/7/17]
- 2 – cnbc.com/2017/07/03/june-ism-manufacturing-index.html [7/3/17]
- 3 – instituteforsupplymanagement.org/ISMReport/NonMfgROB.cfm?SSO=1 [7/6/17]
- 4 – marketwatch.com/story/gold-slips-set-for-weekly-decline-ahead-of-jobs-report-2017-07-07 [7/7/17]
- 5 – markets.wsj.com/us [7/7/17] 6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F7%2F16&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F7%2F16&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F7%2F16&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F6%2F12&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F6%2F12&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F6%2F12&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F6%2F07&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F6%2F07&x=0&y=0 [7/7/17]
- 6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F6%2F07&x=0&y=0 [7/7/17]
- 7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [7/7/17]
- 8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [7/7/17]