Economic Monitor – Weekly Commentary
by Scott J. Brown, Ph.D.

What Did We Learn This Week?

August 27, 2021

As expected, Fed Chair Powell’s Jackson Hole speech pointed toward tapering, but fell short of signaling precisely when. Powell includes himself in the camp expecting to start by the end of the year, provided that “the economy evolves broadly as expected.&rdq

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Investment Strategy
by Larry Adam
Chief Investment Officer, Private Client Group

Weekly Headings

September 10, 2021

Key Takeaways

  • The fed learned its lesson about transparency

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    Weekly Market Snapshot

    September 10, 2021

    Market Commentary
    by Scott J. Brown, Ph.D., Chief Economist

    Next week: Inflation figures may be a bit mixed in August (used vehicle prices have begun to fall). Industrial production should have risen moderately. Retail sales are likely to have been mixed (unit motor vehicle sales fell sharply), with some impact from the delta variant.


    Indices

      Last Last Week YTD return %
    DJIA 35,443.82 35,213.12 15.8%
    NASDAQ 15,331.18 14,945.81 18.95%
    S&P 500 4,536.95 4,470.00 20.79%
    MSCI EAFE 2,384.89 2,339.25 11.05%
    Russell 2000 2,304.02 2,213.98 16.67%

    Consumer Money Rates

      Last 1 year ago
    Prime Rate 3.25 3.25
    Fed Funds 0.07 0.08
    30-year mortgage 2.93 2.85

    Currencies

      Last 1 year ago
    Dollars per British Pound 1.3853 1.320
    Dollars per Euro 1.1894 1.185
    Japanese Yen per Dollar 109.88 106.19
    Canadian Dollars per Dollar 1.251 1.313
    Mexican Peso per Dollar 19.857 21.652

    Commodities

      Last 1 year ago
    Crude Oil 70.37 41.37
    Gold 1826.90 1937.80

    Bond Rates

      Last 1 month ago
    2-year treasury 0.20 0.21
    10-year treasury 1.32 1.25
    10-year municipal (TEY) 1.45 1.29

    Treasury Yield Curve – 09/10/2021

    Chart

    As of close of business 09/09/2021


    S&P Sector Performance (YTD) – 09/10/2021


    Chart

    As of close of business 09/09/2021


    Economic Calendar

    September 14  —  Consumer Price Index (August)
    September 15  —  Industrial Production (August)
    Septmeber 16  —  Jobless Claims (week ending September 11)
     —  Retail Sales (August)
    Septmeber 17  —  UM Consumer Sentiment (mid-September)
    September 21  —  Building Permits, Housing Starts (August)
    September 22  —  FOMC Policy Decision
    October 8  —  Employment Report (September)
    November 3  —  FOMC Policy Decision

     

    All expressions of opinion reflect the judgment of the author and are subject to change. There is no assurance any of the forecasts mentioned will occur or that any trends mentioned will continue in the future. Investing involves risks including the possible loss of capital. Past performance is not a guarantee of future results. International investing is subject to additional risks such as currency fluctuations, different financial accounting standards by country, and possible political and economic risks, which may be greater in emerging markets. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, and state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Municipal bonds may be subject to capital gains taxes if sold or redeemed at a profit. Taxable Equivalent Yield (TEY) assumes a 35% tax rate.

    The Dow Jones Industrial Average is an unmanaged index of 30 widely held stocks. The NASDAQ Composite Index is an unmanaged index of all common stocks listed on the NASDAQ National Stock Market. The S&P 500 is an unmanaged index of 500 widely held stocks. The MSCI EAFE (Europe, Australia, Far East) index is an unmanaged index that is generally considered representative of the international stock market. The Russell 2000 index is an unmanaged index of small cap securities which generally involve greater risks. An investment cannot be made directly in these indexes. The performance noted does not include fees or charges, which would reduce an investor’s returns. U.S. government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. U.S. government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the U.S. government.

    Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments. Gross Domestic Product (GDP) is the annual total market value of all final goods and services produced domestically by the U.S. The federal funds rate (“Fed Funds”) is the interest rate at which banks and credit unions lend reserve balances to other depository institutions overnight. The prime rate is the underlying index for most credit cards, home equity loans and lines of credit, auto loans, and personal loans. Material prepared by Raymond James for use by financial advisors. Data source: Bloomberg, as of close of business Septmeber 9, 2021.

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