Wall Street returned to its winning ways last week with all three major averages recording new all-time highs. The Dow Jones Industrials led the pack with a 2.16% advance followed by the S&P 500 (1.6%) and the NASDAQ (1.4%). The Dow Transports were also strong and moved higher by 1.7%, despite a $2.41 spike in oil prices and disruptions from recent weather events. Adding to the euphoria, all market sectors except for utilities were in the plus column, led by energy, telecom and basic materials.
The Consumer Price Index – the monthly cost of a basket of goods and services across the country – rose 0.4% in August, the largest rise since January and putting inflation fears back on the table. However, not all categories contributed to the gain with grocery prices and airfares moving lower, offsetting gains in gasoline and rent. Growth forecasts have started to ebb following the two devastating hurricanes over the past several weeks, which will impede improvements in the giant chemical and energy sectors. Reconstruction efforts, however, should start to bring GDP back to normal as we head into 2018.
September, normally a sluggish month for stocks, has caught the bears off guard and short-sellers needed to cover their positions bidding up equities to records. The bull market will end sometime, but for now the backdrop remains positive. Wildcards not priced in at current levels are additional missile launches by North Korea, continued dysfunction in Washington and more catastrophic weather conditions in the next six weeks of hurricane season. On Wednesday, the Federal Reserve is expected to hold interest rate hikes at bay and begin paring its balance sheet. And OPEC will meet on Friday to discuss production cuts for the first quarter of next year. In the meantime, the bulls continue to fend off the naysayers, with the domestic and global fundamentals apparently still sufficiently reassuring to limit the selling on down days and to restore buyer confidence shortly thereafter.
Here is the answer to last week’s trivia question: The first Exchange Traded Fund in the U.S. was the S&P 500 Depository Receipt or SPDR. It was originally released on January 1 of what year? 1984, 1987, 1993 or 2000. Answer: 1993
Today’s Trivia Question: Weber-Stephen Products, maker of the iconic Weber-brand barbecue grills, is? Owned by BDT Capital Partners; Family Owned; a division of Whirlpool Corp.; Publicly Traded on the NASDAQ under the symbol WEBR.