Week in Review with Maureen Kelliher
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Each week, Investment Officer and resident economist Maureen Kelliher comments on investment trends and economic news which impact the financial markets.

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Capital Market Implications for the Week of October 9 - 13, 2017

Last week’s economic releases reflected the impact of the September hurricanes and the strength of the consumer. Both the Consumer Price Index and the Producer Price Index spiked in September, rising 1.7 percent and 2.2 percent year-over-year, respectively. The surge in these indices reflected the supply chain disruptions from the Texas and Florida storms and most likely will reverse over the next several months. Retail sales increased 1.6 percent month-over-month in September, as consumers splurged on revamping and rebuilding their homes but skimped on restaurants. Industrial production also improved in September increasing 0.3 percent versus a decline of -0.7 percent in August.

Given the stock market’s recent strength, it wasn’t too surprising that the market was slow to react to the commencement of third-quarter corporate earnings reports last week. Thus, for the week overall, the S&P 500 Index gained 0.2 percent while the Dow Jones Industrial Index rose 0.4 percent. The week’s best performing equity sectors were real estate and consumer staples, which climbed 1.8 percent and 1.5 percent, respectively. The poorest performing sector for the week was telecommunications, which plunged -4.6 percent. International stocks, as represented by the MSCI EAFE Index, increased 1.6 percent while emerging markets jumped 2.1 percent. Bonds also had a good week, as the yield on the ten-year Treasury note declined. For the week overall, the Barclays U.S. Aggregate Bond Index gained 0.5 percent, ten-year municipal bonds rose 0.4 percent, U.S. corporate bonds increased 0.6 percent whilst high yield bonds were flat.

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Week in Review

Securities and other investment products are:

Wealth Management Disclosure

 

Weekly Macro Updates

 

  • Initial Unemployment Claims (week of 10/7) 250k est., 243k actual, 258k prior
  • Continuing Claims (week of 9/30) 1930k est., 1889k actual, 1921k prior
  • JOLTS Job Openings (Aug) 6125 est., 6082 actual, 6140 prior
  • Prod Price Index Ex Food & Energy YoY (Sep) 2.0% est., 2.2% actual, 2.0% prior
  • PPI Final Demand YoY (Sep) 2.6% est., 2.6% actual, 2.4% prior
  • Con Price Index Ex Food & Energy YoY (Sep) 1.8% est., 1.7% actual, 1.7% prior
  • CPI YoY (Sep) 2.3% est., 2.2% actual, 1.9% prior
  • Real Average Hourly Earnings YoY (Sep) 0.7% actual, 0.7% prior-R+
  • Retail Sales Advance MoM (Sep) 1.7% est., 1.6% actual, -0.1% prior
  • Retail Sales Ex Auto & Gas MoM (Sep) 0.4% est., 0.5% actual, 0.1% prior-R+
  • University of Michigan Sentiment Index (Oct P) 95.0 est., 101.1 actual, 95.1 prior
  • University of Michigan Expectations (Oct P) 85.3 est., 91.3 actual, 84.4 prior
  • Empire Manufacturing (Oct) 20.4 est., 30.2 actual, 24.4 prior
  • Industrial Production MoM (Sep) 0.3% est., 0.3% actual, -0.7% prior-R+
  • Strong or Improving
  • Inconclusive or lacking trend
  • Weak or declining

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