Telemus Weekly Market Review

May 29 – June 2, 2017

The stock market got off to a sluggish start this week as investors begrudgingly returned following the extended Memorial Day holiday weekend. However, things picked up in the second half of the week as employment data for the month of May came into focus. The S&P 500 ended the week higher by 0.96%, the Dow was up 0.60% and the Nasdaq once again led the pack gaining 1.54%.

With the markets closed on Monday equities ticked down on Tuesday and Wednesday, breaking the S&P 500’s seven-session winning streak, as the energy and financials sectors weighed on the broader market. Crude oil influenced the energy sector lower following reports of increased production in Libya while cautious comments about second quarter results from major players negatively impacted the heavily-weighted financial group.

Things turned around on Thursday after the ADP National Employment Report for May soundly beat expectations. The S&P 500 hit some technical resistance at its then all-time high, but a bullish EIA petroleum inventory report and solid leadership from the financials, consumer discretionary, and health care sectors helped the benchmark index, and its peers, advance to new record highs.

The positive momentum carried into pre-market action on Friday, but a disappointing Employment Situation Report for May forced investors to hit pause. Specifically, nonfarm payrolls, nonfarm private payrolls, and average hourly earnings all missed expectations. However, in the grand scheme of things, the jobs report wasn’t all that bad; nonfarm payrolls still increased, there was no wage deflation, and the unemployment rate fell to a 16-year low of 4.3%.

Investors took the report in stride, pushing the major averages to new record highs for the second day in a row. The technology sector led the charge, but the energy and financials spaces showed relative weakness, yet again. A flattening of the yield curve weighed on financials while energy moved lower with crude oil following President Trump’s announcement of his decision to pull out of the Paris Climate Accord.

The fed funds futures market still points to the June FOMC meeting as the most likely time for the next rate-hike announcement with an implied probability of 95.8%, up from last week’s 83.1%. The benchmark 10 year U.S. Treasury note closed Friday at 2.18% down roughly 7 basis points from last weeks close.
Crude oil fell over 5% for the week closing Friday at $47.26 on continuing supply concerns.

June 5 – June 9 Economic Calendar

  • Monday
  • Productivity and Costs
    8:30 AM ET
  • Gallup US Consumer Spending Measure
    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
  • Labor Market Conditions Index
    10:00 AM ET
  • Money Supply
    4:30 PM ET
  • Tuesday
  • Gallup US ECI
    8:30 AM ET

  • Redbook
    8:55 AM ET
  • JOLTS
    10:00 AM ET
  • Factory Orders
    10:00 AM ET
  • ISM Non-Mfg Index
    10:00 AM ET
  • Labor Market Conditions Index
    10:00 AM ET
  • Money Supply
    4:30 PM ET
  • Wednesday
  • MBA Mortgage Applications
    7:00 AM ET
  • Gallup U.S. Job Creation Index
    8:30 AM ET
  • EIA Petroleum Status Report
    10:30 AM ET
  • Consumer Credit
    3:00 PM ET
  • ISM Non-Mfg Index
    10:00 AM ET
  • Labor Market Conditions Index
    10:00 AM ET
  • Money Supply
    4:30 PM ET
  • Thursday
  • Jobless Claims
    8:30 AM ET

  • Bloomberg Consumer Comfort Index
    9:45 AM ET
  • Quarterly Services Survey
    10:00 AM ET
  • EIA Natural Gas Report
    10:30 AM ET
  • 3-Month Bill Announcement
    11:00 AM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
  • Friday
  • Wholesale Trade
    10:00 AM ET

  • Baker-Hughes Rig Count
    1:00 PM ET
  • PMI Services Index
    9:45 AM ET
  • Factory Orders
    10:00 AM ET
  • ISM Non-Mfg Index
    10:00 AM ET
  • Labor Market Conditions Index
    10:00 AM ET
  • Money Supply
    4:30 PM ET

PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS. This market 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.