Markets: The market rallied this week, with the Dow Jones 30, the S&P 500, and the Russell 2000 all making new all-time highs. The RUSSELL small caps went gangbusters in Sept., gaining over 6% in 1 month. The DOW and S&P both added ~ 2% for the month.
“For the first time in over three years, each of the three major Dow stock market averages has just hit a new all-time high the Dow Jones Industrial Average, Dow Jones Transportation Average, and Dow Jones Utility Average. This development is rare: Its happened in fewer than 4% of the months since 1970. But here’s the even better news: Never have any of these prior events occurred at a bull market top. The least bullish of any prior occurrences (which came in the spring of 2007) still came five months before a top”.
“To be sure, investors usually don’t pay much attention to the Dow utilities. Most of us focus just on the Dow industrials. And among those who focus on Dow averages beyond the Dow industrials, most focus on just the Dow transports. That’s because of the famous Dow Theory, the oldest market timing system that remains in widespread use today, which holds that joint new highs of both averages is confirmation that were in a bull market.”(Source: MarketWatch)
Dividend Stocks Update: These high dividend stocks go ex-dividend this coming week: 8Point3 Energy Partners LP (NASDAQ:CAFD), Dynex Capital Inc (NYSE:DX), Whitestone REIT (NYSE:WSR), Hannon Armstrong Sustainable Infrastructure Capital (NYSE:HASI), Barnes & Noble Inc (NYSE:BKS), Global Net Lease Inc (NYSE:GNL).
Volatility: The VIX fell 1% this week, and finished at $9.51, its lowest point since mid-July.
Currency: The $ rose vs. most major currencies this week, except for the Loonie and the Pound.
Market Breadth: 14 of the DOW 30 stocks rose this week, vs. 19 last week. 69% of the S&P 500 rose, vs. 56% last week.
Economic News: “U.S. consumer spending barely rose in August, as Hurricane Harvey weighed on auto sales and annual inflation increased at its slowest pace since late 2015, pointing to a moderation in economic growth in the third quarter. The weak report from the Commerce Department on Friday did little to change expectations that the Federal Reserve would raise interest rates in December. Chair Janet Yellen said on Tuesday the Fed needed to continue gradual rate hikes despite uncertainty about the path of inflation.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, edged up 0.1 percent last month also as unseasonably mild temperatures in some parts of the country reduced demand for utilities. That followed an unrevised 0.3 percent increase in July.” (Source:Reuters)
US Q2 GDP was adjusted upward to 3.1%. Consumer Confidence remains high, at 119.8.
New Home Sales fell 20K in August; Pending Home Sales fell -2.6%>
Week Ahead Highlights: The 4rd quarter begins next week, with the Sept. Non-Farm Payrolls report and the Unemployment Rate both due out on Friday. Q3 Earnings season will start the following week, when some DOW 30 and S&P 500 companies will report.
Next Week’s US Economic Reports: There will be multiple Mfg.reports due out next week, in addition to the Auto Sales and Consumer Credit reports.
Sectors: The Energy sector led in Sept., with Telecoms and Utilities trailing.
Futures: Natural Gas futures rose 1.93% in Sept., while WTI Crude rose 10.89%.
