Market Perspective for November 1, 2019

The S&P 500 Index and the Nasdaq made new all-time highs this week, The Nasdaq increased 1.76 percent, while the S&P 500 Index gained 1.49 percent. The Dow Jones Industrial Average returned 1.45 percent. The Russell 2000 Index gained 1.96 percent.

Healthcare was the best performing sector on strong earnings. SPDR Healthcare (XLV) increased 3.07 percent. iShares U.S. Healthcare Providers (IHF) advanced 3.30 percent. Technology and financials also excelled. SPDR Technology (XLK) and SPDR Financials (XLF) rallied 2.10 percent and 1.61 percent, respectively. Strong earnings from Apple (AAPL) helped shares climbed 3.76 percent.

The Federal Reserve cut interest rates by 25 basis points but signaled no additional rate cuts should be expected soon.

The labor market received great news on Friday. New jobs totaled 128,000 in October, beating estimates of 75,000. That was despite roughly 40,000 striking workers coming out of the jobs total. Additionally, the Bureau of Labor Statistics revised its August and September jobs numbers higher by 95,000. Unemployment was 3.6 percent, up 0.1 percent, as discouraged workers returned to the labor market. Wage growth was 0.2 percent.

The Conference Board’s consumer confidence index dipped slightly to 125.9 in October, though showing consumers remain optimistic amid a strong labor market. Pending home sales increased 1.5 percent. The Markit Manufacturing PMI for October was 51.3, showing the manufacturing sector still in expansion.

Crude oil slipped this week, closing at $56.20 per barrel. Earnings from Exxon (XOM) and Chevron (CVX) failed to spur energy equities, although some smaller producers jumped on strong results. SPDR Energy (XLE) fell 0.32 percent on the week.

iShares MSCI EAFE (EFA) gained 1.48 percent and iShares MSCI Emerging Markets (EEM) 1.24 percent.

The 10-year Treasury yield fell to 1.73 percent. Corporate and government bonds rallied along with falling bond yields, while high-yield and floating rate funds saw small losses.

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