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U.S. housing starts declined 2.6% to an annual rate of 1.25 million units in January. Homebuilding is up 10.5% from January 2016. Single-family homes, which accounts for the largest share of the residential housing market, climbed 1.9%. The volatile multi-family housing segment starts tumbled 10.2%. Permits for future construction jumped 4.6% for the month to a rate of 1.29 million units, the highest level since November 2015. Builders continue to grapple with shortages of skilled labor. (Commerce Department)

Industrial production contracted in January, weighed down by a sharp decline in utilities, a move that is more reflective of the weather than economic activity. Manufacturing grew 0.2% and mining, which includes oil and gas, jumped an impressive 2.8%. (LPL Research)

Kraft Heinz a U.S. food company which owns Heinz Ketchup and Kraft Macaroni and Cheese has made an offer to merge with Dutch consumer goods company Unilever in a deal worth an estimated $125 billion. Unilever owns brand names Hellmann's mayonnaise, Ben & Jerry's ice cream and Knorr soups. Unilever has declined the proposal. (Reuters)

Join us the weekend for Financial Focus Radio when we will tackle the question … … “when will this bull market end?”

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



Increased spending at gas stations and restaurants in January, pushed up retail sales by 0.4%. Service station sales increased 2.3%, restaurants and bars rose 1.4%, and auto sales slipped 1.2%. Over the past 12 months, retail sales have risen 5.6%. (Commerce Department)

Consumer prices saw their biggest increase in nearly four years in January up by 0.6%.  In the last 12 months’ consumer inflation is up 2.5%, the biggest year-on-year gain since March 2012. Gas prices climbed 7.8%, accounting for nearly half of the rise in CPI. Food prices were up 0.1%, the cost of food consumed at home was unchanged, and the cost of medical care rose 0.2%.  (Labor Department)

 

Cisco Systems, a Dow component, beat street expectations on quarterly profits and matched on sales. The networking equipment maker got a boost from strong sales of its security-related products. (CNBC)

Kraft Heinz, the company behind Heinz Ketchup and Oscar Mayer products bested quarterly earnings and revenue expectations, but that is not helping the stock today.  The company saw its bottom line benefit from lower input costs and cost cutting from their merger in 2015.

 

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



Small business optimism rose again in January to its highest level since December 2004, according to the National Federation of Independent Business - Index of Small Business Optimism.  The Index reached 105.9. Five of the Index components increased and five decreased, but many held near their record high. The recent growth in optimism looks like the surge in the Index in 1983, which was followed by years of economic prosperity.

Producer prices rose in January by 0.6%. That is the largest gain in four years, but a strong dollar continued to keep underlying inflation tame. The PPI has increased 1.6% in the last 12 months. Prices for final demand goods increased 1%, the largest rise since May 2015. (Labor Department)

Total mortgage application volume is down nearly 31% from a year ago. Mortgage applications to purchase a home are 3% higher than a year ago and refinance volume is down 50% year-over-year and now stands at its lowest level since June 2009. With rising interest rates housing costs are moving borrowers to opt for adjustable-rate mortgages, which reached their highest level in over a year. (Mortgage Bankers Association)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



Happy Valentine Day. The S&P 500 has risen only 40.9% percent of the time on Valentine's Day, compared to a historical daily rate of 52.1%. (CNBC)

The S&P 500 now has a market cap of $20 trillion crossing that mark for the first time ever. (CNBC) It is just 30 stocks but the exchange-traded funds that track the Dow Jones Industrial average have pulled in $2.6 billion in new assets so far in 2017, more than any other U.S. stock ETF. (WSJ)

The S&P 500 hit its 2016 low on February 11th and has since gained more than 26% since then. Over the past year, we've seen a massive global stock market rally, with financials, energy, and materials leading in the U.S. A year ago there were calls to "sell everything".  Another example why the market timers’ hall of fame” is an empty room in Paducah, KY. (LPL Research)

Japan Q4 gross domestic product data of plus 0.2% and 2016 GDP of up 1.0%, were modestly disappointing. Most telling was the miss in exports.

Apple posted a record closing high yesterday, which was last set a year ago in February 2015. (CNBC)

Oil is up 50 cents at $53.41 a barrel. Global demand for oil could outdo the ten-year average in 2017 as the health of the world economy improves. (OPEC)  

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.


 



Chinese trade expanded both imports and exports.  The increase in exports suggests that the weaker yuan boosted exports. The data suggests an improving Chinese and global economy. (LPL Research)
 
Many oil market participants have questioned whether OPEC members would adhere to the production cuts agreed to at their November 2016 meeting. Saudi Arabia has actually reduced output more than they had agreed upon. This reduction has kept oil prices stable even as U.S. production has increased. (LPL Research)

Busy economic data calendar this week. Fed Chair Yellen's semiannual monetary policy testimony to Congress is the highlight. We will also get January CPI, retail sales, leading indicators, housing starts and industrial production. (LPL Research)

I think a revolution was launched in 1773 over the taxing caffeinated beverages.  The Democrat led Oregon House Committee on Revenue has introduced House Bill 2875 that would impose a five cent per pound tax on coffee beans.   Proceeds from the tax would go to some blackhole called the "Alternative Education Sustainability Fund.” (Willamette Week)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



Initial claims for unemployment insurance remained pinned to 40-year-plus lows in the latest week, and continue to suggest that the labor market is tightening. Claims do provide a recession signal when they rise between 75,000 and 100,000 over a six-month period. Six months ago, claims were running in the 260,000 to 270,000 per week level. Over the last four weeks, claims have averaged 244,000 per week, so claims are running roughly 20,000 below six-month-ago levels and are not signaling a recession. (LPL Research)

After a slow start to fourth quarter earnings season, a solid 69% of S&P 500 companies have bested estimates, pushing the year-over-year earnings growth rate for the S&P 500 to 8.3%--nicely above the 6.1% consensus growth rate. Energy is poised to break earnings growth drought. It's been two years since the energy sector produced a year-over-year gain in quarterly earnings but is now tracking to +1%. (LPL Research)

Sears shares hit its lowest level since its merger with Kmart back in 2005, under $6/share on Thursday. There was no specific news to explain why shares fell. Today Sears is up over 20%, after announcing plans to cut debt and pension obligations by $1.5 billion this year. Sears was once one of America's leading retailers and an icon. (CNN)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



Chinese foreign currency reserves fell last month to just under $3 trillion. While this is still a huge stockpile, China's reserves were roughly $4 trillion at their peak. Declining reserves call into question the government's ability to continue to support the yuan. (LPL Research)

European earnings growth for the fourth quarter is tracking in the mid-teens, ahead of the U.S. on rebounding energy sector profits and resilient economic growth in the face of political uncertainty. The macroeconomic outlook is still very much uncertain with elections coming up, particularly in France, and Greece back in the news. (LPL Research)

The US stock market is not yinging and yanging much.
The last time the S&P 500 closed down by at least 1% was 81 trading days ago on October 11th.  That's the longest stretch without 1% correction since 2006. The last time before that that there was such a long period of calm was 1995. (Bespoke Investment Group)

Whole Foods Market is shutting nine stores nationally.  The company has not provided a list of stores slated for closure. Whole Foods recorded a 1.9% sales increase in the quarter.  The company earned $95 million or 30 cents a share, down from $157 million or 46 cents last year. (AP)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



The National Federation of Independent Business says small business hiring grew in December at an average rate of 0.15 workers per firm, the strongest result since September 2015. NFIB says 53% of small business owners hired or attempted to hire workers, up from 51% in November. Fifteen percent of small business owners said that finding qualified workers was their single biggest problem.

International trade unexpectedly narrowed in December. At $44.3 billion in December 2016, the nation's trade deficit on goods and services was smaller than the $45.7 billion deficit in November 2016. (LPL Research)

The makers of Cadbury, Oreos, Dentyne, Ritz and Tang, Mondelez posted quarterly profits of 47 cents per share, on sales below expectations. CEO Irene Rosenfeld said results were impacted by weakness in its business abroad. (CNBC)

Alaska Air, the nation’s fifth largest airline, posted a quarterly profit of $1.56 per share. Sales beat forecasts and the company increased its quarterly dividend to 30 cents per share. (AP)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



It is a quiet week ahead for economic data and policy. With only some data from China. (LPL Research)

We will call fourth quarter earnings season good but not great. Earnings growth for the S&P 500 for the quarter are now tracking to 7.9%. Results have been driven by improvement in the energy sector, which is now tracking toward a 1% year-over-year increase. (LPL Research)

We have had time to dig into Fridays jobs report. It showed the economy is performing well enough to create lots of jobs, but not enough to cause wages to rise. Average hourly earnings-a timely but imperfect proxy for wage inflation-decelerated to a 2.5% year-over-year gain in January from the 2.8% reading in December. (LPL Research)

Hasbro posted sales that were up 11.2% to $1.63 billion, helped by strong demand for its Disney Princess and Frozen dolls. Hasbro said revenue from toys in the girl’s category jumped 52%. Global sales of its gaming products also rose 11%. That pushed profits upward to $192.7 million, or $1.52 per share, in the quarter, from $175.8 million, or $1.39 per share, a year earlier. (Reuters)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



The Department of Labor says the US economy added 227,000 jobs in the first month of 2017.  Private sector added 237,000 jobs and government shed 10,000 jobs.  Unemployment rate stands at 4.8%. Wages grew 2.2% over the last 12 months.

Worker productivity remains well below average. Output per man hour, or productivity, posted a 1% year-over-year increase in Q4 of 2016, but is still well below the pre-Great Recession pace of 2.5-3.0% seen in the 10 years prior to 2007. Slow productivity growth combined with a slow growing labor force keeps the lid on the maximum pace of gross domestic product growth. (LPL Research)

Should you root for the Patriots? The Super Bowl Indicator claims that the stock market does better for the year if an original team from the NFL (NFC) wins versus a team from the AFC. When the NFC wins, the markets have been up 10.9% versus up only 4.3% if the AFC wins. Taking it a step further, when the Patriots have been in the Super Bowl (eight previous times), the full year gain has been only 0.3% with the return actually worse after they won. (LPL Research)

Join us this weekend for Financial Focus Radio when we will talk about the importance of diversification in your wealth building efforts.

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



The manufacturing sector expanded in January with the Institute for Supply Management index hitting 56. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting. The overall economy has grown for 92 consecutive months. (AP)

Ahead of Fridays big government jobs report ADP
says private companies added 246,000 new workers to the payroll in January. Goods-producing companies hired 46,000 workers, the highest in two years. Construction added 25,000 jobs and manufacturing added 15,000 jobs. Services added 201,000 positions. Firms employing 50-499 workers added 102,000 jobs. Small businesses hired 62,000, while large companies hired 83,000 persons. (CNBC)

The Portland office of Walmart Labs is cutting eight of its 29 positions as part of their e-commerce business. Company-wide the company is cutting a total of 200 positions from the e-commerce organization. (PBJ)

Facebook exceed earnings and revenue estimates as ad sales grew 53%. (AP)

Royal Dutch Shell recorded its worst annual profit in more than a decade, as low oil prices continue to weigh on the industry. (CNBC)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



The Federal Reserve ends a two-day meeting this afternoon with an announcement on interest rates. Don't expect a change to rates at this meeting, though the Fed's statement could shape expectations for the rest of the year. (AP)

Apple saw strong demand for the iPhone 7 with profits in the quarter up 8% to $3.36 a share, and sales increased 3% to $78.4 billion. Over the quarter, 78.3 million iPhones were sold, up 5% from a year earlier. Services revenue increased 19% in the quarter to $7.17 billion. (AP)

The employment cost index rose 0.5% in the final quarter of 2016. The ECI reflects how much companies, and governments pay their employees in wages and benefits. The index grew by 2.2% in 2016 and 2% in 2015. Wages represent about 70% of a company’s cost to employ its workers. Benefits rose 0.4%, marking the smallest increase in since the spring of 2015. (MarketWatch)

Whole Foods is shuttering its three commercial kitchens, which manufacture ready-to-eat meals for stores. Whole Foods is going to outsource food preparation. (WSJ)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



Stocks dropped to close lower yesterday with the Dow logging its worst daily loss since mid-October as investors grappled with the latest policy decisions by President Donald Trump.  The Dow also dropped back below the 20,000 level.  Wall Street is also looking ahead to a heavy week of economic data, corporate earnings and the latest meeting by the Federal Reserve set to begin Today.

Americans spent more on new cars and other big-ticket items in December to finish the year on an optimistic note, though a key level of inflation hit the highest level in more than two years.  Consumer spending rose 0.5% last month, matching the estimate. That’s the biggest increase in spending in December since the last month of 2009, just as the U.S. began to emerge from the Great Recession.

Personal income advanced 0.3 percent last month after nudging up 0.1 percent in November. Wages and salaries rebounded 0.4 percent after slipping 0.1 percent in November. Income increased 3.5 percent in 2016 after rising 4.4 percent in 2015.

Shares of Fitbit Inc. plunged 17% to a record low yesterday after the company cut its fourth-quarter guidance and announced plans to lay off more than 100 workers.  Following “weaker-than-expected” holiday sales, Fitbit said it expects an adjusted loss per share of 51 cents to 56 cents in the quarter.  The company said it plans to lay off about 110 employees, or 6% of its workforce, as part of a restructuring of the business.

Shares of airline companies were knocked lower yesterday and are at a 2 month low amid concerns that the nationwide protests at airports in response to President Trump’s executive order to ban immigration from certain predominantly Muslim countries would curtail demand.

With Northwest Quadrant Wealth Management I’m Tyler Simones



New home sales in December fell 10.4% to an annual rate of 536,000 homes. Sales totaled 563,000 in 2016, up 12.2% year over year their highest since 2007. (Commerce Department)

Bank of the Cascades fourth-quarter profits jumped 43% to $5.9 million. Net income for 2016 was $16.8 million compared with $20.6 million in 2015. In 2016 the BOTC paid $4.9 million in merger-and-acquisition expenses lowering profits. (PR Newswire)

All that Facebooking takes some juice. Prineville, the home to several large data centers for both Facebook and Apple is running low on electricity. That means plans for a proposed factory cannot be supported on the current power grid. The factory could provide 300 additional jobs if electricity can be provided. (Oregonian)

Microsoft posted a 3.6% jump in profits for the quarter making $5.2 billion. Revenue, excluding LinkedIn, was $25.838 billion.  Their LinkedIn division had revenue of $228 million in the quarter, equaling a loss of $100 million. Microsoft's shares re up 23.2% in the past 12 months. (Reuters)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



Umpqua Bank, the largest bank based in the State, reported $24.8 billion in assets up 6% in 2016. Deposits climbed 7% to $19 billion. With low interest rates Umpqua's net interest income fell 3% in 2016 to $844 million. The bank had a Q4 profits of $0.27 per share. (PBJ)

Formerly one of the largest privately held companies in Oregon, door and window maker Jeld-Wen is looking to raise $452 million in an IPO. The IPO would value the company at about $2.4 billion. Jeld-Wen sold 58% of the company to a Canadian investment firm Onex in 2011 for $864 million. Onex moved Jeld-Wen's headquarters to North Carolina in 2015.
(Oregon Live)

Big boy toy maker Caterpillar, reported a loss fourth quarter of $1.17 billion or $2 per share. The company had revenue of $9.57 billion in the period. Caterpillar shares are up 6% in 2017 and up 69% in the last 12 months. The company says it will benefit from President Trump’s infrastructure-spending plan but those impacts won’t be seen before late 2017. (AP)

AT&T, the No. 2 U.S. wireless carrier, reported quarterly profits of $2.44 billion, or 39 cents per share on revenue of $41.84 billion. Capital spending is estimated around at $22 billion in 2017. (Reuters)


With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



Big rally yesterday as President Trump took jobs action. The S&P 500 and the Nasdaq posted record closes. The Dow finished less than 90 points away from 20,000. (CNBC)

Home resales fell in December by 2.8% from the prior strong month. That is an annual rate of 5.49 million units.  Home sales of 5.45 million units in 2016 is the highest since 2006 and up from 5.25 million in 2015. The number of unsold homes on the market fell 6.3% from 2015 to 1.65 million units, the lowest level since 1999.  (National Association of Realtors)

The Wall Street Journal exposes more ethical rot at Wells Fargo.  It is reporting branch managers were warned at least 24 hours in advance of “surprise” internal inspections.

Boeing reported fourth-quarter profits of $1.63 billion or 2.59 per share. The airplane builder had sales of $23.29 billion in the quarter. Boeing shares are up 3% in 2017 and are up 29% in the last 12 months. (AP)

McDonald's is rolling out a revamped Big Mac tomorrow.  To celebrate they will give away 10,000 bottles of the Big Mac Special Sauce at participating locations around the nation. (USA Today)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



Johnson & Johnson posted better-than-expected fourth-quarter profits but lowered their 2017 sales forecast. J&J profits came in at $1.58 a share. Sales for the quarter were $18.1 billion. (The Street)
3M, makers of Scotch tape and Post-it notes, reported quarterly results with profits of to $1.15 billion, or $1.88 per share. 3M's operating expenses fell 2.3% in the fourth quarter. Net sales fell 0.4% to $7.33 billion. The company gets more than 60% of its revenue from outside the United States. The company's stock is up 28% in the last 12 months. (Reuters)

Supermarket operator Kroger, owner of Fred Myers, will fill 10,000 jobs in 2017. This represents about 2% of Kroger's total workforce. Kroger had about 431,000 full- and part-time employees as of January 2016. The company hired more than 12,000 workers in 2016. (USA Today)

Kimberly-Clark, the maker of Huggies diapers and Kleenex tissue reported fourth-quarter profits of $505 million or $1.40 per share. That comes on sales of $4.54 billion. Kimberly-Clark shares have climbed 2.5% since the beginning of the year, but the stock has fallen more than 6% in the last 12 months. (AP)

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.
 



It is Inauguration Day!  Stock market are open today so free markets and democracy are the call of the day.

December housing starts leapt 11.3% to an annual rate of 1.23 million units.   November's starts were revised up to a 1.10 million-unit rate. (Commerce Department)

Americans filing initial claims for unemployment benefits fell last week by 15,000 to 234,000 for the week. Claims for the previous week was 249,000. (Labor Department)

General Electric reported fourth-quarter profits of 46 cents per share on sales of $33.1 billion. Oil and gas revenue fell 22%, power systems revenue rose 20%, renewable energy revenue jumped 29%, and aviation rose 7%. (IBD)

Procter & Gamble, maker of Tide and Pampers reported profits of $7.88 billion, or $2.88 per share. Up from $3.21 billion, or $1.12 per share, a year earlier. P&G had sales of $16.85 billion. The company has been focusing on core brands, and sold 41 of its brands last year, including Clairol and Covergirl brands.  (Reuters)

Join us this weekend for Financial Focus Radio when I will talk to our tax guru Greg Fowler and trusted insurance advisor Don Klippenes.

With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.


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