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Weekly Updates

Weekly Update – August 24, 2018

  • U.S. and global stocks ended an otherwise meandering week on a high note after Fed Chairman Jerome Powell said the fundamentals of the U.S. economic expansion look strong and warrant the central bank’s plan to raise rates gradually. Fed meeting minutes released earlier in the week indicated that many participants felt it would be appropriate to raise interest rates “soon.” The U.S. dollar eased on Powell’s comments, while oil finished an already-strong week higher, largely on sentiment that sanctions against Iran will limit supply. The 10-year U.S. Treasury yield rose on Friday as stocks gained, a reversal from earlier in the week when headlines on Trump’s potential legal challenges prompted some investors to seek safer assets.
  • Friday August 24th’s market close marked the longest S&P 500 bull market in history, surpassing the previous record set between November 1990 and March 2000.
  • Existing-home sales for July fell 0.7% to a 5340K SAAR from June’s 5380K, marking the fourth consecutive month of declines and the slowest pace in two years. However, median home prices increased 4.5% year-over-year to $269,600 – the 77th straight month of annualized gains.
  • New-home sales also declined in July, following a decline in June. Purchases of newly built single-family homes fell 1.7% to a seasonally adjusted annual rate of 627,000 in July. The drop went counter to economists’ expectations and only adds to recent signs that rising input costs, supply constraints and financial conditions are weighing on a key segment of an otherwise robustly growing economy.
  • Markit US Flash Manufacturing PMI fell to 54.5 in August from last month’s 55.3 (est. 55.2), hitting a nine-month low. The report noted weak new order volumes and cautious hiring as companies have seen higher operating expenses.
  • Orders for durable goods declined a seasonally adjusted 1.7% in July from the prior month, led by easing aircraft sales. Excluding that, durable goods orders actually grew 0.2%.


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