Weekly Newsletter 9/15/2014

Global markets moved lower this past week in the midst of very light economic data releases.  The move lower in both bonds and stocks appears to be driven by currency flows and interest rates.  Recent releases, speeches and meeting minutes from the US Federal Reserve have had a hawkish stance.  Additionally, the looming end to the Federal Reserve’s bond purchase program is pushing bond investors to start to unwind bond holdings which is putting upward pressure on US interest rates.

The most notable report out of the US for the week was a modest uptick in the National Federation of Independent Businesses (NFIB) Optimism Index.  This index is compiled monthly and is a survey of small businesses in the US.  The index moved up to 96.1 for August, up from the previous month’s reading of 95.7.  While a positive, the NFIB index survey also showed small business owners’ top three concerns as taxes, regulations and poor sales.

Overseas, the Japanese economy is showing strong signs of turning lower, yet the Japanese stock market has been grinding higher.  This past week Japanese GDP for the 2nd quarter 2014 came in at an annualized -7.1%.  This was well off the 1st quarter number of 6.1%.  As we have seen in both the US and Europe, good news is being received as bad news in hopes of more economic stimulus being ushered in as the economy sags.

We continue to keep a close watch on global economic and market movements to gain market insight.

Global Market Index Performance

Global Market Perf 9-15-14

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 9-15-14

Chart 2 – US Aggregate Bond Index

$AKG 9-15-14

Global Data Points

Econ Data Points 9-15-14

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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.