September 23 – September 27 Week in Review

The stock market suffered a case of the nerves last week as investors were seemingly rattled by negative trade and political developments. As a result the S&P 500 fell 1.0%, the Nasdaq Composite declined 2.2%, and the Russell 2000 dropped 2.5%.

The Dow Jones Industrial Average was the best of the worst, declining just 0.4% last week. This might have been due to an understanding that the U.S. economy remains in pretty decent shape. Weekly jobless claims remained at historically low levels; the annual pace of new home sales for August was one of the highest readings since October 2007; pending home sales rebounded 1.6% in August; preliminary data showed encouraging manufacturing activity in the U.S. for September; and inflation pressures remained muted.

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The S&P 500 health care, energy, and communication services sectors led the broader market’s retreat. Many energy stocks were pressured by the continued decline in oil prices. The communication services sector was weighed down by shares of Facebook, which lost nearly 7% amid recurring antitrust concerns. The defensive-oriented consumer staples, utilities, and real estate sectors were the lone sectors to finish higher last week.

The market had two noticeable declines last week, with the first one coming on Tuesday as the news hit of an impeachment inquiry on President Trump. Through all the ensuing political headlines, the market was still trending toward a relatively flat week until Friday when headlines out of Bloomberg indicated the White House was considering limiting U.S. investors' portfolio flows into China and delisting Chinese companies from U.S. stock exchanges. While these were just headlines they clouded the outlook for a trade deal and threatened to upend the goodwill established ahead of trade talks on Oct. 10-11.

It was arguably a terrible week for IPOs. Smile Direct Club continued its decline, falling more than 25% on the week. Peloton fell 11% in its first day of trading, which reportedly caused Endeavor Group to scrap its IPO one day before going public. The We Company postponed its IPO and Adam Neumann was pressured to step down as CEO.

In other markets demand last week for U.S. Treasuries was rather tepid, as yields only declined modestly. The 2 year yield declined three basis points to 1.65%, and the 10 year yield declined three basis points to 1.69%. The U.S. Dollar Index advanced 0.6% to 99.10 and WTI fell to $55.90 a barrel as supply concerns eased.

September 30 – October 4 Economic Calendar

  • Monday
  • Chicago PMI
    9:45 AM ET
  • Dallas Fed Mfg Survey
    10:30 AM ET
  • Tuesday
  • Redbook
    8:55 AM ET
  • PMI Manufacturing Index
    9:45 AM ET
  • ISM Mfg Index
    10:00 AM ET
  • Construction Spending
    10:00 AM ET
  •  
  • Wednesday
  • Motor Vehicle Sales
    7:00 AM ET
  • MBA Mortgage Applications
    7:00 AM ET
  • USA US:ADP Employment Report
    8:15 AM ET
  • EIA Petroleum Status Report
    10:30 AM ET
  •  
  • Thursday
  • Challenger Job-Cut Report
    7:30 AM ET
  • Jobless Claims
    8:30 AM ET
  • PMI Services Index
    9:45 AM ET
  • Factory Orders
    10:00 AM ET
  • ISM Non-Mfg Index
    10:00 AM ET
  • EIA Natural Gas Report
    10:30 AM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
    • Friday
    • Employment Situation
      8:30 AM ET
    • International Trade
      8:30 AM ET
    • Baker-Hughes Rig Count
      1:00 PM ET
    • Jerome Powell Speaks
      2:00 PM ET

PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS. This commentary is a matter of opinion and is for informational purposes only. It is not intended as investment advice and does not address or account for individual investor circumstances. Investment decisions should always be made based on the client's specific financial needs, goals and objectives, time horizon and risk tolerance. The statements contained herein are based solely upon the opinions of Telemus Capital, LLC. All opinions and views constitute our judgments as of the date of writing and are subject to change at any time without notice. Information was obtained from third party sources, which we believe to be reliable, but not guaranteed.

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