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 January 8 - 12, 2018

Although there were several economic releases for January last week, it was December’s inflation gauges and retail sales that captured the attention of market participants. On Thursday, the Producer Price Index was reported and it was slightly less than expected, as both headline and core (the index less the more volatile segments of food and energy) wholesale prices declined -0.1% during December. On the other hand, core consumer prices increased 0.3% for the month, which was above expectations, while headline consumer prices rose a more meager 0.1% driven by a decline of -2.7% in gas prices in December. With auto sales, building materials and non-store retail categories all having increased in December, retail sales for the month were solid. Additionally, over the last three months, retail sales grew 8.9% annualized, which was the best quarterly showing since 2003.

For the second week of the year, global stock markets climbed higher making 2018 one the strongest starts to a year for stocks in some time. For the week, the S&P 500 Index gained 1.6% while the Dow Jones Industrial Average increased 2.0%. The week’s best performing equity sector was energy, which rose 3.2%. The worst performing sectors for the week were once again utilities and real estate, which fell -2.1% and -3.4%, respectively. Last week, international markets continued their rally, as the MSCI EAFE Index rose 1.2% and emerging markets gained 0.6%. Conversely, with interest rates have risen and consequently bond prices have fallen, thus far, it has been an inauspicious start to the year for bond investors. For the week overall, the Barclays U.S. Aggregate Bond Index lost -0.2%, ten-year municipal bonds fell -0.5% while both U.S corporate and high yield bonds ended the week relatively unchanged.

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Week in Review

Securities and other investment products are:

Wealth Management Disclosure


Weekly Macro Updates


  • Initial Unemployment Claims (week of 1/6) 245k est., 261k actual, 250k prior
  • Continuing Claims (week of 12/30) 1920k est., 1867k actual, 1902k prior
  • Import Price Index YoY (Dec) 3.1% est., 3.0% actual, 3.3% prior-R+
  • Export Price Index YoY (Dec) 2.6% actual, 3.1% prior
  • Prod Price Index Ex Food & Energy YoY (Dec) 2.5% est., 2.3% actual, 2.4% prior
  • Con Price Index Ex. Food & Energy YoY (Dec) 1.7% est., 1.8% actual, 1.7% prior
  • Real Average Hourly Earnings YoY (Dec) 0.4% actual, 0.2% prior
  • Retail Sales Ex Auto and Gas (Dec) 0.4% est., 0.4% actual, 1.2% prior-R+
  • Retail Sales Control Group (Dec) 0.4% est., 0.3% actual, 1.4% prior-R+
  • Empire Manufacturing (Jan) 19.0 est., 17.7 actual, 19.6 prior
  • Industrial Production MoM (Dec) 0.5% est., 0.9% actual, -0.1% prior-R-
  • Capacity Utilization (Dec) 77.4% est., 77.9% actual, 77.2% prior-R+
  • Manufacturing Production (Dec) 0.3% est., 0.1% actual, 0.3% prior-R+
  • NAHB Housing Market Index (Jan) 72 est., 72 actual, 74 prior
  • Strong or Improving
  • Inconclusive or lacking trend
  • Weak or declining

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