Weekly Market Update, December 14, 2015

Posted on December 20, 2015 by Neal Gallagher

Presented by Mark Gallagher

General market news
• Yields moved lower across the board last week, and the 10-year Treasury opened at 2.12 percent early Monday morning. The 10-year Treasury is below 2.20 percent for only the third day since the beginning of November, in anticipation of the Federal Open Market Committee meetings this week. Experts expect the Federal Reserve (Fed) to raise rates by 25 basis points (bps); however, mixed economic numbers, along with turbulent markets, could cause the Fed to further delay the liftoff.
• Last week was tough for global equity markets, as oil sank to $36 per barrel and worries about the health of the junk bond market intensified.
• In the U.S., the S&P 500 Index decreased 3.74 percent, and the Russell 2000 Index decreased 5.01 percent.
• Internationally, the MSCI EAFE Index decreased 1.50 percent, and the MSCI Emerging Markets Index decreased 2.84 percent.

Equity Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	–3.74%	–3.19%	–0.27%	0.96%
Nasdaq Composite	–4.04%	–3.40%	5.45%	6.12%
DJIA	–3.19%	–2.43%	–0.72%	0.57%
MSCI EAFE	–1.50%	–2.02%	–0.91%	–1.53%
MSCI Emerging Markets	–2.84%	–3.07%	–15.44%	–14.27%
Russell 2000	–5.01%	–6.16%	–5.56%	–2.40%

Source: Bloomberg

Fixed Income Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	0.29%	1.17%	1.08%
U.S. Treasury	0.57%	1.59%	1.35%
U.S. Mortgages	0.17%	1.72%	1.70%
Municipal Bond	0.57%	3.17%	3.17%

Source: Morningstar Direct

What to look forward to
We’re anticipating several important economic releases this week, beginning with insight into consumer inflation and the Consumer Price Index, where prices are expected to be flat.

Housing Starts are expected to show an increase for November. Industrial Production data will also be released midweek.

Finally, the Fed is widely expected to increase rates by 25 bps in its meeting culminating on Wednesday.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Barclays Capital Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Barclays Capital Mortgage-Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Barclays Capital Municipal Bond Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million. The Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index measures the performance of intermediate (1- to 10-year) U.S. TIPS.

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Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 7th Ave East, North Saint Paul, MN, 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.

Weekly Market Update, November 30, 2015

Posted on December 3, 2015 by Neal Gallagher

Presented by Mark Gallagher

General market news
• The yield on the 10-year Treasury opened at 2.21 percent early Monday morning, slightly above the lowest level we’ve seen in more than three weeks. Although it seems that a majority of investors, along with the fed funds futures, expect the Federal Reserve to raise rates in December, the Treasury markets are actually signaling more uncertainty. The 30-year yield opened below 3 percent on Monday, again at the lowest level we’ve seen in three weeks.
• U.S equity markets were relatively flat during last week’s holiday-shortened trading session.
• The S&P 500 increased 0.08 percent, as there was little in the way of news to move markets.
• Elsewhere, emerging markets sold off; weak commodity prices and a strong dollar drove the decline.

Equity Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	0.08%	0.76%	3.48%	3.22%
Nasdaq Composite	0.46%	1.65%	9.56%	8.38%
DJIA	–0.10%	1.13%	2.18%	2.30%
MSCI EAFE	–0.47%	–1.22%	1.42%	–2.05%
MSCI Emerging Markets	–2.02%	–2.48%	–11.47%	–15.47%
Russell 2000	2.35%	3.62%	0.99%	3.87%

Source: Bloomberg

Fixed Income Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	–0.32%	0.82%	0.91%
U.S. Treasury	–0.44%	0.98%	1.12%
U.S. Mortgages	–0.24%	1.44%	1.59%
Municipal Bond	0.33%	2.51%	3.03%

Source: Morningstar Direct

What to look forward to
The service sector will receive some attention this week, with releases of both manufacturing and nonmanufacturing data. The ISM Manufacturing survey is expected to remain fairly flat, while the ISM Nonmanufacturing index is likely to pull back but remain at healthy levels.

The main focus this week, however, will be Friday’s Employment Report, where expectations are for a gain of 220,000 jobs.

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Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.
Authored by the Investment Research team at Commonwealth Financial Network.

Weekly Market Update, November 16, 2015

Posted on November 19, 2015 by Neal Gallagher

Presented by Mark Gallagher

General market news
• Rates declined last week, as commentary from various Federal Open Market Committee (FOMC) members slightly decreased market expectations for a potential hike in interest rates in December. The yield on the 10-year Treasury was 2.25 percent early Monday morning, below last Monday’s level of 2.36 percent. The 30-year, which stood at 3.13 percent last Monday, opened at 3.05 percent on November 16.
• U.S. equity markets fell last week, snapping a six-week winning streak.
• The Russell 2000 Index was the worst performer. Tepid retail spending by U.S. consumers hit the index, which has a lot of domestic exposure, particularly hard.
• Elsewhere, shares in emerging markets sold off, as increasing odds of a December rate hike in the U.S. pushed the MSCI Emerging Markets Index lower.

Equity Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	–3.56%	–2.58%	0.06%	1.25%
Nasdaq Composite	–4.22%	–2.38%	5.22%	6.49%
DJIA	–3.64%	–2.18%	–1.16%	0.17%
MSCI EAFE	–1.71%	–3.21%	–0.62%	–2.55%
MSCI Emerging Markets	–3.66%	–3.12%	–12.05%	–14.82%
Russell 2000	–4.40%	–1.25%	–3.75%	–1.01%

Source: Bloomberg

Fixed Income Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	–0.61%	0.53%	1.27%
U.S. Treasury	–0.73%	0.69%	1.50%
U.S. Mortgages	–0.41%	1.27%	1.93%
Municipal Bond	–0.36%	1.80%	2.74%

Source: Morningstar Direct

What to look forward to
We will shift our attention to consumer-level inflation this week and are expecting headline prices to firm a bit.

We will also gain insight into manufacturing activity with releases of Industrial Production and the Philadelphia Fed Business Outlook Survey.

Data on Housing Starts and the latest FOMC meeting minutes will be released midweek.

Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2587 East 7th Ave, North Saint Paul, MN, 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.

Weekly Market Update, October 26, 2015

Posted on October 29, 2015 by Neal Gallagher

Presented by Mark Gallagher

General market news
• Volatility was muted last week as the 10-year moved between 2.00 and 2.10 in anticipation of the Federal Reserve (Fed) this week; the 10-year opened on Monday at 2.06. Comparing the moves to the previous week’s, rates moved more abruptly, shifting from 1.90 to 2.13 in less than a weeks’ time. The 30-year was also much less volatile and remained closer to its lows, opening the week at 2.86.
• The Fed is set to meet this week with an announcement due on Wednesday. The probability of the Fed moving this year, let alone at this meeting, has dropped considerably. The Fed is likely to wait until sometime next year before making a move, assuming the U.S. economy continues to improve.
• Global equity market performance was broadly up this week.
• The Nasdaq Composite was the best performer during the week, as solid earnings beats at tech firms like Google and Amazon drove the index higher.
• Elsewhere in the U.S., large-cap stocks finished up for the week after the indices rallied on the back of decent earnings results at big tech and industrial firms.

Equity Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	2.09%	8.19%	2.47%	7.83%
Nasdaq Composite	2.97%	8.96%	7.30%	13.70%
DJIA	2.56%	8.49%	0.95%	7.58%
MSCI EAFE	0.84%	8.16%	2.94%	3.09%
MSCI Emerging Markets	0.39%	9.75%	–7.01%	–9.30%
Russell 2000	0.33%	6.00%	–2.19%	5.63%

Source: Bloomberg

Fixed Income Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	0.34%	1.47%	2.07%
U.S. Treasury	–0.02%	1.77%	2.45%
U.S. Mortgages	0.29%	1.91%	2.67%
Municipal Bond	0.25%	2.02%	2.59%

Source: Morningstar^® Direct

What to look forward to
This week will be busy and will begin with New Home Sales and Durable Goods Orders data. The Fed’s announcement regarding interest rates will be made midweek. The advance estimate of third-quarter gross domestic product is expected to come in at 1.4 percent.

The week will end with Personal Income and Outlays data, with income and spending expected to have softened slightly in September, and the release of University of Michigan Consumer Confidence.

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Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave #304, North Saint Paul MN 55106. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.