Weekly Market Review

October 17 – 21 

The stock market meandered through a lazy week with the S&P 500 adding 0.38% after spending the week in a 24-point range. The benchmark index was outpaced by the Nasdaq Composite’s +0.83% advance, while the Dow Jones Industrial Average settled little changed, adding 0.04%.

Market participants received another batch of quarterly results with the reporting season set to hit full stride next week. Investors did receive above-consensus results from a large share of Dow components. On the whole, tech earnings were received with the warmest reception, evidenced by the outperformance in the Nasdaq Composite. Interestingly, the batch of beats did not spark a buying frenzy and activity remained sluggish. The WSJ discussed this dynamic, noting that trading has averaged 5.9 billion shares a day since October 10th, 19% below this year’s daily average volume.

The week started on a quiet note as participants awaited a slew of earnings and Thursday’s policy decision from the European Central Bank. However, range bound action continued through Friday. China stabilization was a widely discussed theme during the week though it did not seem to have much of an impact on global risk sentiment. China Q3 GDP growth of 6.7% year over year was unchanged from Q2 and in line with expectations.

The European Central Bank made no changes to its interest rate corridor and President Mario Draghi made sure to avoid any specific references to either tapering or extending the purchase program before March 2017. The euro climbed immediately after the policy announcement, but retreated during Mr. Draghi’s press conference. The single currency continued declining on Friday, ending the week near 1.0875 against the dollar, near levels from early March.

To be fair, the decline in the euro was facilitated by all-around dollar strength as the greenback benefited from economic data and comments from FOMC Vice-Chair William Dudley, who said a rate hike before the end of 2016 makes sense to him. The implied probability of a rate hike in December stands at 69.9%, according to the Fed Funds futures market. For its part, the Dollar Index registered its third consecutive weekly gain, climbing 0.7% to levels not seen since late January. The 10 year U.S. Treasury note closed at 1.738%, up fractionally in yield for the week.

The strength in the dollar prevented crude oil from making big strides. The energy component settled at $51, just above its closing level from last week.

October 24 – 28 Economic Calendar

  • Monday
  • Chicago Fed National Activity Index
    8:30 AM ET
  • William Dudley Speaks
    9:00 AM ET
  • James Bullard Speaks
    9:05 AM ET
  • PMI Manufacturing Index Flash
    9:45 AM ET
  • Charles Evans Speaks
    1:30 PM ET
  • Jerome Powell Speaks
    1:45 PM ET
  • Dennis Lockhart Speaks
    1:20 PM ET
  • Money Supply
    4:30 PM ET
  • Tuesday
  • Redbook
    8:55 AM ET
  • FHFA House Price Index
    9:00 AM ET
  • S&P Corelogic Case-Shiller HPI
    9:00 AM ET
  • Consumer Confidence
    10:00 AM ET
  • Richmond Fed Manufacturing Index
    10:00 AM ET
  • State Street Investor Confidence Index
    10:00 AM ET
  • Dennis Lockhart Speaks
    1:20 PM ET
  • Money Supply
    4:30 PM ET
  • Wednesday
  • MBA Mortgage Applications
    7:00 AM ET
  • International Trade in Goods
    8:30 AM ET
  • PMI Services Flash
    9:45 AM ET
  • New Home Sales
    10:00 AM ET
  • Housing Starts
    8:30 AM Et
  • EIA Petroleum Status Report
    10:30 AM ET
  • Dennis Lockhart Speaks
    1:20 PM ET
  • Money Supply
    4:30 PM ET
  • Thursday
  • Durable Goods Orders
    8:30 AM ET
  • Jobless Claims
    8:30 AM ET
  • Bloomberg Consumer Comfort Index
    9:45 AM ET
  • Pending Home Sales
    10:00 AM ET
  • EIA Natural Gas Report
    10:30 AM ET
  • Kansas City Fed Manufacturing Index
    11:00 AM ET
  • Fed Balance Sheet
    4:30 PM ET
  • Money Supply
    4:30 PM ET
  • Friday
  • GDP
    8:30 AM ET
  • Employment Cost Index
    8:30 AM ET
  • Consumer Sentiment
    10:00 AM ET
  • Baker-Hughes Rig Count
    1:00 PM ET
  • Charles Evans Speaks
    1:30 PM ET
  • Jerome Powell Speaks
    1:45 PM ET
  • Dennis Lockhart Speaks
    1:20 PM 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.