Wild swings in the Dow Industrials during mid-week ended with the average loosing just 0.2%, thanks in part to Nike’s 12% advance and gains by the Dow’s two big banks: JPMorgan Chase and Goldman Sachs. The S&P 500, however, wasn’t as kind with a negative 0.6% for the week. And once again traders took profits in technology stocks sending the sector down over 3% and the NASDAQ overall by 2%. Transports were the star of the week, climbing nearly 2%. In all, only three other sectors were positive (financials, energy and basic materials), as some banks decided to raise dividends and oil recovered $3.00/bbl. to $46.04, on news that the U.S. rig count decreased for the week following 23-weeks of steady gains.
World banks are suggesting that the days of easy money are over and equities will have to find another catalyst to move higher. Long-term treasury yields surged on the aspect of a tightening money supply as bonds gave up ground as did the U.S. dollar and gold prices. The yield on the ten-year Treasury, which moves inversely to the price, rose to 2.298% from last week’s close of 2.146%.
The broader U.S. equity markets have made good progress so far in 2017, but haven’t been able to build on these gains in the closing weeks of the June quarter. The U.S. stock market drifted sideways during the month as the averages have had some trouble breaking into high ground of late, suggesting that traders are looking for any signs of a positive direction.
Markets will be closed on Tuesday in observance of Independence Day. In the meantime, enjoy the long holiday weekend.
Here is the answer to last week’s trivia question: The Federal Reserve recently hiked the short-term fed funds rate (the interest rate at which banks and credit unions lend reserve balances to other depository institutions overnight) to a range of 1.0% – 1.25%. What is the current “prime rate” (the rate banks charge their most credit-worthy customers)? 2.5%, 3.0%, 4.25% or 5.0%. Answer: 4.25%.
Today’s Trivia Question: Alexander’s, Inc., traded on the NYSE, is a real estate investment trust engaged in leasing, managing and developing properties in the New York City metropolitan area. The company was originally founded in 1928 as a: International shipping company, department store chain, amusement park or timberland developer?