Clarksville Weekly Market Snapshot from Frazier Allen for the week of February 13th, 2017

Clarksville, TN – The economic data calendar was thin. December trade figures were roughly in line with expectations. The University of Michigan Consumer Sentiment Index fell in the mid-February estimate.

Stock market investors were encouraged by the prospect for tax cuts following comments by U.S. President Donald Trump. In contrast, the bond market, recognizing that the process for cutting taxes will be contentious and lengthy, is less fearful of a large boost to the federal budget deficit (hence, bond yields have backed down over the past month).

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Clarksville Weekly Market Snapshot from Frazier Allen for the week of February 8th, 2017

Clarksville, TN – The Federal Open Market Committee left short-term interest rates unchanged, as expected, and tweaked the wording of the policy statement slightly. There were no solid clues as to the timing of the next increase in short-term interest rates, but officials noted the improvement in consumer and business sentiment and seemed a little more confident that inflation “will” increase to the 2% goal.

While January numbers are often suspect due to the magnitude of the seasonal adjustment, the economic data continued to paint a picture of the economy that is in good shape.

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Clarksville Weekly Market Snapshot from Frazier Allen for the week of January 15th, 2017

Clarksville, TN – The economic calendar was relatively thin. Small business optimism rose sharply in December.  Growth in retail sales was concentrated in autos and gasoline – mixed and generally flat otherwise (with unusual softness in food) – but it was still a relatively good quarter overall. 

Department store sales were weak, but that is a long-term trend (not necessarily a sign of consumer weakness). The PPI was largely in line with expectations, reflecting moderate pipeline inflationary pressures (consistent with further Fed rate hikes in the months ahead).

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Clarksville Weekly Market Snapshot from Frazier Allen for the week of December 11th, 2016

Clarksville, TN – Italy voted “no” on its constitutional referendum and Prime Minister Renzi resigned. South Korea’s president was impeached. The European Central Bank extended its asset purchase program to the end of 2017, but will reduce the monthly pace of purchases in April.

None of that disturbed U.S. equity market investors who continued to enjoy the Trump sizzle. After showing some signs of stability, bond yields again moved higher.

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