Last Week:

Markets got hit early last week.

Why did markets move down last week? In short…. Apple. Most companies have been doing well. The concern has not been about recent/current sales and earnings. The concern is: can it keep going? Early last week there was a report that led people to believe Apple won’t be able to make their iPhone sales projections. The result… markets moved down in a fairly large way.

You’ve heard of FANG stocks? I’ve chosen to spell it… FAANG. The acronym stands for: Facebook, Amazon, Apple, Netflix, and Google. Those five companies move markets and have for several years now. If they go up, the markets go up. When they go down, the markets go down.

Where’s your model? Late this summer my model was at 4 “Bull” (good) and 0 “Bear (bad). About a month ago it moved to 3 Bull/1 Bear. This past week it moved to 2 Bull/2 Bear… a neutral trend. But we aren’t too far away from 1/3.

Retail sales, in October, were up +0.8%. That was a sharp rebound from the -0.1% in September.

Inflation continues to creep upward. The Producer Price Index (PPI) came out a week ago Friday. Year-over-year through October wholesale inflation is now at +2.9% (up +0.3% from the month before). As you would expect: when inflation hits wholesale prices it will eventually impact consumer prices. The Consumer Price Index (CPI) came out last Wednesday. Year-over-year through October consumer inflation is now at +2.5% (up +0.2% from the month before).

This Week:

The economic focus of the week: Black Friday. The National Retail Federation says that 30% of annual retail sales take place from Thanksgiving through Christmas. It’s estimated that 100 million people will brave the crowds on Black Friday looking for that special deal.

U.S. stock markets will be closed on Thursday and will close early at 1pm on Friday; both in observance of the Thanksgiving holiday.

Earnings season is pretty much over. Some of the companies reporting this week: Barnes & Noble, Best Buy, Deere, Gap, Kohl’s, Target, TJX, and Urban Outfitters.

Indicator focus:  October’s housing starts (Tue); and October’s durable goods (Wed).

Have a wonderful Thanksgiving.


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