Weekly Economic & Market Update 4/20/15

Global stocks sagged this past week led by weak economic news from China, the US and the resurgence of concern over Greece. Early in the week China reported a drop in exports month over month for March of -15% and a drop in imports of -12.7%. Since China has been a big piece of the driving force behind the global economy for the last 20 years, its slowdown will have meaningful impacts. Many institutional investors view the slow down as bad news that is really good news with the thought that China will increase its economic stimulus efforts.

Here in the US the retail sales ex-autos numbers for March came in at .4% on a month over month basis. The retail numbers, considering the economic stimulus efforts, continue to fall short of expectations leading some investors to question the economic recovery. The Consumer Price Index (CPI) measure for March on a year-on-year basis came in at -.1% which also fell short of expectations and hopes from the Federal Reserve (FED). Continuing low CPI readings will make it harder for the Fed to decide to raise rates. Continuing low rates makes investors happy.

Also in focus this past week was the continuing story with energy which can best be told through the chart below.

Rotary Rigs graph 4-20

In this chart we have the spot price of oil and the rotary energy drilling rig count from Baker Hughes (leading US drilling company). As you can see, the rig count has fallen significantly and with it so too has employment in high oil producing states.

We continue to monitor the global market place for hints to directions of markets.

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

$SPX 4-20

Chart 2 – Aggregate Bond

$AKG 4-20

Securities 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.