WEEKLY ECONOMIC UPDATE

WEEKLY ECONOMIC UPDATE
WEEKLY QUOTE “The book you don’t read won’t help.”  – Jim Rohn WEEKLY TIP Sell old stuff to fund a new experience. Sell what you don’t need online or at a yard sale and use the proceeds to partly or fully fund a vacation, an education, or an adventure. WEEKLY RIDDLE What 11-letter word must always be spelled incorrectly? Last week’s riddle: Joe and Paul both live in the same town, on the same street. They both visit the same hardware store and purchase the same type and brand of product on the same day and at the same time. Paul spends $3.00 on 102, but Joe is charged only $2.00 for 98. Assuming Paul has not been overcharged and Joe has not been undercharged, what have they purchased? Last week’s answer: They’ve purchased numbers for the front of their homes at $1/each. Joe lives at 98 Elm St . He purchased two digits. Paul lives at 102 Elm St . He purchased three digits.	November 8, 2010 FIRST NET JOB GAIN SINCE MAYEconomists polled by Dow Jones Newswires thought non-farm payrolls would increase by about 60,000 for October. In a pleasant surprise, the economy added 151,000 jobs instead. While the jobless rate remained at 9.6% for October, Labor Department data showed the economy adding jobs for the first time in five months – a development implying moderate growth instead of a “double dip” recession.1 TWO MORE SIGNALS OF EXPANSIONThe Institute for Supply Management released its October assessments of the manufacturing and service sectors last week, and both ISM indices showed improvement. The manufacturing index climbed to 56.9 from 54.4 and the service sector index improved to 54.3 from September’s 53.2 reading.2 CONSUMERS SPEND A BIT MORE September’s personal spending gain wasn’t that impressive – just 0.2%. Economists surveyed by Bloomberg had forecast a 0.4% increase in for the month. The Commerce Department data also showed a 0.1% decrease in personal income, the first such reduction since July 2009.3 PENDING HOME SALES SUDDENLY SLIPThey fell by 1.8% in September, according to the National Association of Realtors. They haven’t declined in three months. September 2010 pending sales were 24.9% underneath year-ago levels.4 STOCKS HIT 2010 HIGHSThe Dow, S&P 500 and NASDAQ quickly reached YTD peaks after the Federal Reserve announced its plans to buy $600 billion worth of Treasuries over the next eight months. Here is how the big three performed last week: Dow, +2.93% to 11,444.08; S&P 500, +3.60% to 1,225.85; NASDAQ, +2.85% to 2,578.98. Some key commodities took off as well – oil prices gained $5.42 on the week, gold gained $40.20 across five days to close at $1,397.30 on the COMEX Friday, and copper advanced 5.68% for the week.5,6,7 COMING NEXT WEEK: The schedule of economic releases is very light. Tuesday, we have data on September wholesale inventories. Wednesday, we have initial jobless claims for 11/6 and continuing claims as of 10/30. Friday, we get the initial October survey of consumer sentiment from the University of Michigan. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA +9.74 +14.37 +1.73 +0.43 NASDAQ +13.65 +22.50 +3.78 -2.45 S&P 500 +9.93 +14.93 +0.09 -1.44 REAL YIELD 11/5 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS 0.48% 1.41% 2.06% 4.03% Source: cnbc.com, bigcharts.com, ustreas.gov, bls.gov - 11/5/106,8,9,10 Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.
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«RepresentativeDisclosure» This material was prepared by Peter Montoya Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information should not be construed as investment, tax or legal advice. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. General risks inherent to investments in stocks include the fluctuation of market prices and dividend, loss of principal, market price at sell may be more or less than initial cost and potential illiquidity of the investment in a falling market. Citations. 1 – online.wsj.com/article/SB10001424052748704353504575596060581399440.html [11/5/10] 2 - ism.ws/ISMReport/NonMfgROB.cfm [11/3/10] 3 - blogs.barrons.com/stockstowatchtoday/2010/11/01/markets-open-higher-despite-spending-woes [11/1/10] 4 - dailyfinance.com/story/real-estate/september-pending-home-sales-drop-uneven-economic-recovery/19704428/ [11/5/10] 5 - csmonitor.com/Business/2010/1103/Federal-Reserve-to-buy-600-billion-in-bonds-as-hedge-against-deflation [11/3/10] 6 - cnbc.com/id/40032470  [11/5/10] 7 - blogs.wsj.com/marketbeat/2010/11/05/data-points-energy-metals-396/ [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=11%2F5%2F09&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=11%2F5%2F09&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=11%2F5%2F09&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=11%2F4%2F05&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=11%2F4%2F05&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=11%2F4%2F05&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=DJIA&close_date=11%2F6%2F00&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=COMP&close_date=11%2F6%2F00&x=0&y=0 [11/5/10] 8 - bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=SPX&close_date=11%2F6%2F00&x=0&y=0 [11/5/10] 9 - ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [11/5/10] 9 - ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [11/5/10] 10 - treasurydirect.gov/instit/annceresult/press/preanre/2000/ofm11200.pdf [7/12/00]