Floyd E. Miller Presents: Weekly Economic Update for May 23, 2011

Floyd E. Miller Presents: Weekly Economic Update for May 23, 2011

By Floyd Miller

 

 

 

May 23, 2011HOME SALES, HOUSING STARTS SLIPExisting home sales decreased 0.9% in April, according to the National Association of Realtors. Annually, sales were off 12.9% from the pace of April 2010 . The national median existing home price last month was $163,700, 5.0% below where it was a year before. The inventory of unsold residences increased to a 9.2-month supply, up from an 8.3-month supply in March. A new release from the Commerce Department said housing starts declined by 10.6% in April; building permits decreased by 4.0% last month.1,2{{more}}CONFERENCE BOARD LEI INDEX DECLINESThe CB’s Leading Economic Index retreated in April for only the second time since March 2009. The 0.3% slip came after the index rose 0.7% in March and 0.9% in February. On the bright side, the CB’s coincident economic index improved for the third straight month in April.3GOLD GETS BACK ABOVE $1,500; GAS PRICES FALLOn Friday, gold prices topped the $1,500 level for the first time since May 12 – the settlement price on the COMEX was $1,508.90 an ounce, concluding a 1.0% advance for the week. Silver pulled off a 0.3% gain last week to settle Friday at $35.09 an ounce. Crude oil fell 0.2% on the week; retail gas prices decreased by almost $0.10 last week, according to AAA’s Fuel Gauge Survey. 4,5,6STOCKS RETREAT ON INDICATORS, DEBT ISSUES Investors were largely left cold by this week’s economic reports, and anxieties over the debt of Spain and Greece also affected Wall Street. So, all three major U.S. indexes moved south. On the week, they performed like this: DJIA, -0.66% to 12,512.04; S&P 500, -0.77% to 1,333.27; NASDAQ, -0.71% to 2,803.32. In 2011, we are seeing selling in May: the DJIA and S&P 500 are currently on three-week losing streaks.7THIS WEEK: Monday offers 1Q earnings from Campbell Soup, and Wall Street will also be eyeing the elections in debt-burdened Spain. Tuesday, we have the report on April new home sales. Wednesday brings us news about April durable goods orders, plus 1Q results out of Costco and Polo Ralph Lauren. Thursday provides weekly jobless claims data along with 1Q results from Sony and BigLots. The major economic releases of the week all arrive Friday: reports on April consumer spending and pending home sales, plus the final May consumer sentiment poll out of the University of Michigan.% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVGDJIA +8.07 +24.28 +2.46 +1.04NASDAQ +5.67 +27.19 +5.56 +2.16S&P 500 +6.01 +24.42 +1.05 +0.16REAL YIELD 5/20 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO10 YR TIPS 0.85% 1.36% 2.43% 3.52%Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 5/20/117,8,9,10Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.These returns do not include dividends.«RepresentativeDisclosure»This material was prepared by MarketingLibrary.Net 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 and may not be relied on for the purpose of avoiding any Federal tax penalty. 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 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. operates two securities exchanges: the New York Stock Exchange and NYSE Arca . NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. 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.Citations.1 – realtor.org/press_room/news_releases/2011/05/sales_ease [5/19/11] 2 – marketwatch.com/story/us-housing-starts-decline-106-in-april-2011-05-17 [5/17/11]3 – conference-board.org/data/bcicountry.cfm?cid=1 [5/19/11]4 – marketwatch.com/story/gold-futures-advance-in-tug-of-war-market-2011-05-20 [5/20/11]5 – marketwatch.com/story/crude-oil-futures-retake-some-lost-ground-2011-05-20 [5/20/11]6 – consumeraffairs.com/news04/2011/05/price-of-gasoline-down-a-dime-in-last-week.html [5/20/11]7 – cnbc.com/id/43113773 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F20%2F10&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F20%2F10&x=10&y=18 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F20%2F10&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F19%2F06&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F19%2F06&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F19%2F06&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=5%2F21%2F01&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=5%2F21%2F01&x=0&y=0 [5/20/11]8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=5%2F21%2F01&x=0&y=0 [5/20/11]9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [5/20/11]9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [5/20/11]10 – treasurydirect.gov/instit/annceresult/press/preanre/2001/ofm11001.pdf [1/10/01]11 – montoyaregistry.com/Financial-Market.aspx?financial-market=who-should-inherit-your-ira-andor-401k&category=22 [5/22/11]Floyd E. MillerFSC Securities Corporation3300 South 14th St. Suite 100Abilene, TX 79605 676-0138