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market weekly news - RBC website Market Week: December 31, 2012 The Markets
Ending with a whimper: As the year wound to a close with no grand bargain out of Washington, equities took their own trip over the fiscal cliff last week. The last positive day for the S&P 500 was the Thursday before Christmas, and five straight down days took the Dow back under 13,000, the Nasdaq below 3,000, and the S&P 500 perilously close to 1,400. Though all four domestic indices are in far better shape than they were on last New Year's Eve, they also seem likely to end in negative territory for the quarter, handily outpaced--at least for Q4--by a resurgent Global Dow.
Equities data reflect price changes, not total return.
Last Week's Headlines
With the fiscal cliff dead ahead, last-minute negotiations seemed to produce more questions than answers. The stalemate left the country facing tax increases and spending cuts and wondering what fresh uncertainties the new year might bring. Orders for new durable goods orders rose 0.7% in November despite a drop in defense-related aircraft orders, according to the Census Bureau. It was the sixth increase in the last seven months, and the best news was a strong jump in new orders by businesses for capital goods, which were up 2.7% for the month. Home prices measured by the S&P/Case-Shiller 20-city index in October were up an average of 4.3% from a year earlier. Though 12 cities saw price declines from the month before, many of the cities showing the strongest improvement--Las Vegas, Detroit, Phoenix, San Francisco--are the ones that had been hardest hit by the housing collapse. Average home prices represented by the 20-city index are now at roughly the same levels that they were in the fall of 2003. Sales of new homes soared 4.4% in November. According to the Commerce Department, that's the highest level since April 2010 and 15.3% higher than a year earlier. The $299,700 average sales price was up almost 20% from last November. As it did in 2011, the U.S. Treasury will have to adopt "extraordinary measures" to avoid problems once the country hits the debt ceiling on New Year's Eve. A letter to congressional leaders from Treasury Secretary Timothy Geithner said the accounting measures are expected to extend the deadline for roughly two months.
Eye on the Week Ahead
Friday's monthly unemployment numbers and reports on both the manufacturing and services sectors may paint the last portrait of the pre-cliff economy.
Key dates and data releases: Federal Open Market Committee minutes, U.S. manufacturing, construction spending, auto sales (1/2); unemployment/payrolls, U.S. services sector, factory orders (1/4).
" It all would seem to suggest that investors should mainly focus on picking quality funds from undervalued categories, rather than on the vagaries of public opinion, fears stirred up by politicians and even some economists, or overly simplified predictions of where stocks and/or bonds may be headed."
Quite right, I'd say. It took nerves of steel to stay the course and to even just be IN the market after the '08 Crash, but that's what I did, and have been adding and reinvesting gains, too. I'm not unhappy about that today, especially, Mr. Market can be exceedingly pleased with himself today. Everything did well, virtually everything. I am especially glad about owning my small-cap fund today. The Russell 2K is now at a new 52 week high. I'll take it! But of course, we'll see profit-taking tomorrow, eh?
HI Max, I am not suggesting this nor a good money manager/investor, one of the co-worker 'packed up the bag' and put everything into cash/bonds. It was a good move for her IMHO since she'll retire in 1-2 yrs. I think I would be 70% bonds/30% stocks if I am her age... I think she 'walked out' at the right time regards
Comments
Regards,
Ted
Market Week: December 31, 2012
The Markets
Ending with a whimper: As the year wound to a close with no grand bargain out of Washington, equities took their own trip over the fiscal cliff last week. The last positive day for the S&P 500 was the Thursday before Christmas, and five straight down days took the Dow back under 13,000, the Nasdaq below 3,000, and the S&P 500 perilously close to 1,400. Though all four domestic indices are in far better shape than they were on last New Year's Eve, they also seem likely to end in negative territory for the quarter, handily outpaced--at least for Q4--by a resurgent Global Dow.
Market/Index 2011 Close Prior Week As of 12/28 Week Change YTD Change
DJIA 12217.56 13190.84 12938.11 -1.92% 5.90%
Nasdaq 2605.15 3021.01 2960.31 -2.01% 13.63%
S&P 500 1257.60 1430.15 1402.43 -1.94% 11.52%
Russell 2000 740.92 847.92 832.10 -1.87% 12.31%
Global Dow 1801.60 1998.76 1984.57 -.71% 10.16%
Fed. Funds .25% .25% .25% 0 bps 0 bps
10-year Treasuries 1.89% 1.77% 1.73% -4 bps -16 bps
Equities data reflect price changes, not total return.
Last Week's Headlines
With the fiscal cliff dead ahead, last-minute negotiations seemed to produce more questions than answers. The stalemate left the country facing tax increases and spending cuts and wondering what fresh uncertainties the new year might bring.
Orders for new durable goods orders rose 0.7% in November despite a drop in defense-related aircraft orders, according to the Census Bureau. It was the sixth increase in the last seven months, and the best news was a strong jump in new orders by businesses for capital goods, which were up 2.7% for the month.
Home prices measured by the S&P/Case-Shiller 20-city index in October were up an average of 4.3% from a year earlier. Though 12 cities saw price declines from the month before, many of the cities showing the strongest improvement--Las Vegas, Detroit, Phoenix, San Francisco--are the ones that had been hardest hit by the housing collapse. Average home prices represented by the 20-city index are now at roughly the same levels that they were in the fall of 2003.
Sales of new homes soared 4.4% in November. According to the Commerce Department, that's the highest level since April 2010 and 15.3% higher than a year earlier. The $299,700 average sales price was up almost 20% from last November.
As it did in 2011, the U.S. Treasury will have to adopt "extraordinary measures" to avoid problems once the country hits the debt ceiling on New Year's Eve. A letter to congressional leaders from Treasury Secretary Timothy Geithner said the accounting measures are expected to extend the deadline for roughly two months.
Eye on the Week Ahead
Friday's monthly unemployment numbers and reports on both the manufacturing and services sectors may paint the last portrait of the pre-cliff economy.
Key dates and data releases: Federal Open Market Committee minutes, U.S. manufacturing, construction spending, auto sales (1/2); unemployment/payrolls, U.S. services sector, factory orders (1/4).
regards