Weekly Newsletter 9/8/2014

Global investing markets registered a relatively quiet week.  Global economic data releases were equally as quiet but a few important releases were reported.  Starting here in the US, the Institute of Supply Management’s (ISM) monthly report on business came in at its highest point since spring of 2011.  On its own, the ISM report has been gaining strength but some of the strength is in inventories (much like GDP in the US) which is a negative for the economy.  So, we are happy to see the ISM moving forward but will be watching the inventories closely.

Overseas, Japan’s economic reports continue to make slow progress while Europe is looking like it may be going for a triple dip recession.  As readers of this weekly commentary know, it is our view that many parts of Europe are in outright economic depression and many more have barely made it out of recession.  It would seem that we have been looking at this correctly as this past week European Central Bank (ECB) president Mario Draghi lowered the ECB deposit interest rate (the rate European banks earn on deposits left at the ECB) further into negative territory.  The reality is that Europe is not recovering and the central bank is doing all it can to stimulate bank lending.  However, in the end, banks are hesitant to lend to a population that is sorely lacking jobs.  The global market response to Draghi’s announcement was short-lived as many investors remain cautious as to whether a recovery in Europe is actually underway.

Global Market Index Performance

Global Market Perf 9-8-14

Getting Technical with Market Charts

In this section we present charts of the S&P 500 Stock Index and the US Bond Market Index relative to their 50 day (blue line) and 200 day (red line) moving averages.  In addition, we have added the blue shaded area which represents the recent trading channel. The 50 and 200 day moving averages are widely followed market trend indicators that provide a general picture of the health of the broad indexes.

Chart 1 – S&P 500 Index

$SPX 9-8-14

Chart 2 – US Aggregate Bond Index

$AKG 9-8-14

Global Data Points

Econ Data Points 9-8-14Securities are offered through First Allied Securities, Inc. (FASI), a registered Broker Dealer, Member FINRA/SIPC. Advisory Services offered through Lighthouse Financial Advisors, Inc., a Registered Investment Advisor dba Lighthouse Wealth Management (LWM). Lighthouse Financial Advisors, Inc. is not a subsidiary or control affiliate of FASI.

Disclaimer – Information contained herein is taken from sources believed to be reliable, but cannot be guaranteed as to its accuracy. Market opinions contained herein are intended as general observations and are not intended as specific investment advice. The Standard and Poors 500 Index is an unmanaged group of securities considered to be representative of the stock market in general. The Barclays Aggregate Bond Index represents securities that are SEC-registered, taxable, and dollar denominated. The index covers the U.S. investment-grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities. Contact your investment professional to discuss suitability for your particular circumstances. This article does not constitute an offer of sales of any securities. Securities trading is speculative and involves the potential loss of investment. Past results are not necessarily indicative of future results. Lighthouse Financial Advisors, Inc., dba Lighthouse Wealth Management, is registered as an investment advisor with the SEC and only transacts business in states where it is properly registered, excluded or exempted from registration requirements. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the advisor has attained a particular level of skill or ability.

About Katy Chase

Katy Chase, MBA, contributes her own perspective to the team. With previous training in Marketing and French, her perspective offers a mixture of macroeconomic, cultural, and client-focused experiences. In addition, Katy is a baker (with a specialty in chocolate), athlete, perpetual student/learner, volunteer, blogger, Nittany Lion, daughter, grand-daughter, sister, and wife.