What we think

Newsletter: In the Markets – Week-Ending July 7^th, 2017

Crystal Brook Advisors

We Make Financial Planning Crystal Clear™

United States:  Nonfarm payrolls rose a strong 222,000 in June, with the three-month average at 194,000 jobs. Monthly average job gains this year continue the moderating trend that started in 2014 and is consistent with a tighter labor market and rising wages/salaries. (1) Hiring in the services sector remained solid, with gains in business services, education & health, finance, and leisure & hospitality (top graph). The local government sector showed a strong gain in June—summer schools? (1)

Europe: The European single currency gained against the U.S. dollar Wednesday after private sector data showed the region’s economy capped its best quarter in at least six years, adding to investor bets that interest rates are set to rise from their record lows as the recovery finds its feet. (2)  The IHS Markit Composite PMI survey of economic activity for the month of June was marked at 56.3, a modest decline from the 56.8 tally recorded in May but firmly higher than the flash estimate of 55.7. Activity in the services sector, Markit said, slipped to 55.4 from 56.3, but was still ahead of the original estimate of 54.7 and well ahead of the 50 mark that separates economic growth from contraction. (2)

Asia: SINGAPORE, July 3 Manufacturing activity in Asia’s tech-producing economies expanded in June, helped by growing global demand for electronics products, but headwinds in external markets could mean a moderation in growth in the second half of the year. (3)  However, continued declines in energy prices, which weighed on manufacturing activity in Indonesia and Malaysia, could hurt these two economies going forward, analysts say. Meanwhile, in India, sluggish domestic demand offset strong foreign demand and led to a manufacturing slowdown in June. (3)

Latin America: After a promising rise on the global stage that included hosting the 2014 World Cup and the 2016 Summer Olympics, Brazil today is entangled in profound economic and political crises. Latin America’s largest country is not only trying to recover from its deepest-ever recession, but also facing political upheaval brought about by corruption scandals that have embroiled the last three presidents and the leaders of all major political parties. (4)

Monday 7/3    

• The confusion arose when some websites incorrectly showed Amazon (AMZN, Tech30) plummeting 87%, Apple (AAPL, Tech30) dropping 14% and Microsoft (MSFT, Tech30) jumping 79% late Monday. (5)

Tuesday 7/4

• Markets closed.

Wednesday 7/5

• S. stock indexes were mixed Wednesday as energy companies skidded along with oil prices, but technology stocks rose and reversed a portion of their recent losses. (6)

Thursday 7/6

• S. stock indexes were mixed Wednesday as energy companies skidded along with oil prices, but technology stocks rose and reversed a portion of their recent losses. (7)

Friday 7/7

• The Dow Jones Industrial Average DJIA, +0.44% climbed 96 points, or 0.5%, to 21,416, powered by gains in McDonald’s Corp. MCD, +2.10% and Microsoft Corp. MSFT, +1.30% (7)

Contributor: Thomas Padula

Source: (1) Wells Fargo Economic Group, (2) The Street, (3) Reuters, (4) Pew Research, (5) CNN Money, (6) ABC News, (7) Market Watch