Market Perspective for November 15, 2019

Major equity indexes achieved new all-time highs this week. The Dow Jones Industrial Average increased 1.18 percent on the week. The S&P 500 Index increased 0.88 percent and the Nasdaq rose 0.76 percent.

SPDR Healthcare climbed 2.45 percent this week. Health insurance stocks surged with iShares U.S. Healthcare Providers (IHF) gaining 3.50 percent on Friday. SPDR Technology increased 1.30 percent.

Low volatility shares also were up solidly this week. iShares Edge MSCI Minimum Volatility USA (USMV) rose 1.24 percent.

Boeing (BA) jumped 5.89 percent after the aerospace giant said it could resume deliveries of its 737 MAX jet sooner than expected. iShares U.S. Aerospace & Defense (ITA) rallied 2.92 percent.

Economic data was solid. The National Federation of Independent Business small business confidence index increased to 102.4 in October, up from 101.8. The consumer price index climbed 0.4 percent in October, higher than the expected 0.3 percent. Core CPI increased 0.2 percent, as expected.

Producer prices increased 0.4 percent versus 0.3 percent expected. The Federal Reserve, among others, had been worried about low inflation and even deflationary pressure. This confirms the economy is strengthening.

October retail sales increased 0.3 percent, higher than the 0.2 percent forecast. Auto sales drove the results.

Retailer companies issued a number of reports this week. Wal-Mart (WMT) beat estimates, but its shares slipped 0.45 percent on the week. Smaller retailers such as Dillard’s (DDS) reported strong results. Its shares increased 10.59 percent. SPDR Retail (XRT) increased 0.91 percent.

Strong economic data boosted higher-yielding debt and falling yields lifted investment grade, corporate and government bonds.

iShares MSCI EAFE (EFA) declined 0.09 percent and iShares MSCI Emerging Markets (EEM) fell 1.26 percent on the week. Chinese economic data was worse than expected. Chile’s currency tumbled as the country deals with escalating protests. The sliding peso dragged down Latin American shares.

 

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