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The 10-year Treasury yield climbed above 3% yesterday, testing what has been a psychological level for the yield this year. The 10-year yield has trended higher after it jumped 7 bps -- the most on a jobs report day since January 2017 - on September 7, when the August jobs report showed average hourly earnings grew at their fastest pace of the cycle. Calming global conditions have also helped lift longer-term Treasury yields. (LPL)

 

Eighty-two percent of American meals are prepared at home -- more than were cooked 10 years ago, according to researcher NPD Group Inc. The latest peak in restaurant-going was in 2000, when the average American dined out 216 times a year. That figure fell to 185 for the year ended in February, NPD said. (Bloomberg)

 

US capital expenditures are on the rise, with the $341 billion spent this year, putting it on pace to set a 25-year high. Companies are using the windfall from last year's tax cuts to spend freely, and first-half earnings rose some 25 percent for the S&P 500. (CNBC)

 

Share buybacks total more in 2018 than capital expenditures, the first time at least a decade, according to Goldman Sachs.

 

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



U.S. stocks rebounded nicely last week amid the recovery in global equities. The S&P 500 posted its fifth straight gain Friday, its longest winning streak since before the February sell-off. Positive developments in emerging-market countries and U.S. trade officials' efforts to arrange a new round of trade talks with China have boosted the MSCI All-Country World Index to five straight days of gains. (LPL)

After a mixed set of Chinese data on credit and lending conditions last week, the overall picture remains stable. Retail sales rose a solid 9% year over year. Industrial production expanded by 6.1%. (LPL)

Retail sales climb for a seventh month, their longest streak of gains since 2014. Retail sales in the U.S. rose 0.1% last month. Consistent growth in retail sales reflects the health of the U.S. consumer, emboldened by fiscal stimulus implemented earlier this year. Consumer spending accounts for about 70% of GDP, so it is an important barometer for overall economic health. (LPL)

Amazon is investigating suspected data leaks and bribes of its employees. The actions were designed to give an edge to independent merchants who sell their products on Amazon. (WSJ)

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



The Labor Department said that consumer prices rose 0.2 percent in August as declines in healthcare and clothing costs offset increases in the price of gasoline and rents.

According to the JOLTS report the number of U.S. job openings increased to 6.94 million in July, a record high. Higher job openings signal a healthy labor market with motivated employers. The more interesting was the quit rate, or voluntary quits as a percent of separations, which climbed to a 17-year high. An increasing number of workers quitting their jobs can put upward pressure on wages, boosting inflationary pressures in the economy.

Cross marketing and media content are all the rage. Mattel is launching a theatrical film division to produce features based on its popular toys like Barbie, Hot Wheels, and other brands. (CNBC)

Hershey is buying Pirate Brands, the makers of the very yummy Pirate’s Booty from B&G Foods for $420 million in cash. (CNBC)

Join us this weekend for Financial Focus Radio when Tyler and I will talk about the burning question, “should retirees worry about inflation”.

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



The Labor Department said U.S. producer prices unexpectedly fell 0.1 percent in August. Its first drop in 1-1/2 years, as declines in the prices of food and trade services offset an increase in the cost of energy. YOY PPI rose 2.8 percent.

Wells Fargo's plan to reimburse customers who had improperly been sold auto insurance was rejected by regulators. The bank must do more to make sure it has located and compensated every affected driver. (Reuters)

According to Goldman Sachs and Conde Nast’s 2018 Top Brands & Retailers Millennials Love report, Amazon is the leading destination for millennial men, with men ranking the site as their “favorite place to shop” in nearly every category. Men “tend to stick with what they know and like, rather than seek out new products, therefore they turn to Amazon as their one-stop shop.”

Sometimes good marketing ideas go wrong. As part of a Domino's Forever Campaign in Russia, the company offered 100 free pizzas each year for 100 years to customers that got tattoos of the brand's logo on visible parts of their body. Due to the surging number of people getting the tattoo Domino's curtailed the number of accepted winners to 350. (CNBC)

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



The NFIB Small Business Optimism Index for August reached 108.8, a new record in the survey’s history. Small business plans to create new jobs and job openings hit a 45-year high. The survey showed new records of small business owners who believe now is a good time to expand.

On Friday, the 10-year Treasury yield jumped the most on a jobs report day since January 2017 after August data showed average hourly earnings grew at their fastest pace of the economic cycle. Accelerating wage growth has re-ignited inflation expectations. (LPL)

ValueInsureds Modern Homebuyer Survey says 63 percent of respondents predicted home prices will see a correction within two years, the highest share since Spring 2016. Asked what will lower home prices, fifty-four percent said rising mortgage rates, 33 percent said the reduction in homeownership incentives under the 2017 tax reform, 16 percent said a stock market correction, and 11 percent said trade wars.

Schmidt's Deodorant, owned by consumer products giant Unilever, will close its Northeast Portland factory and lay off all 57 employees. Workers will lose their jobs effective October 31st. (Oregonian)

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



So much for sell in May and going away. The S&P 500 Index has now posted five consecutive monthly gains. This rare feat is actually quite bullish: the S&P 500 has been up a year later in 24 of the 25 times this has happened. The most recent occurrence was actually a year ago, and the S&P 500 gained 17.4% over the ensuing 12 months. (LPL)

Last week, emerging market (EM) stocks officially entered a bear market, posting a 20% decline from their late-January peak. (Yahoo Finance)

On September 14, 2008, the day before Lehman failed, if you had bought the S&P 500 index you be up 130%. You would have been underwater underwater even three years later. But in the last 10 years the S&P 500 is up 130 percent and has posted an annual total return of 11 percent. A 60/40 stock/bond portfolio has returned 8 percent over the same 10 years. This is a great example of it is time in the market, not timing the market that counts. (CNBC)

Starbucks' Frappuccino is getting a makeover. The U.S. coffee giant is putting its drink on a diet, looking to reduce its high sugar levels, which have scared away health-conscious consumers and hurt sales. (WSJ)

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



September has historically been a troublesome month for U.S. stocks. In fact, it has the lowest average return out of all 12 months going back to 1950. So far, September 2018 is off to a tough start, with the S&P 500 down all four days so far this month. Only twice in history has the S&P 500 fallen the first 4 days of September, in 1987 and 2001. (LPL)

 

Nonfarm payrolls rose 201K in August, The unemployment rate (3.9%) remained near its lowest level since 2000. Overall, job growth is slowing, which is expected this late in the cycle, but the labor market remains solid. Average hourly earnings rose 2.9% year over year, its fastest pace of growth in this economic cycle. (LPL)

 

The Institute for Supply Management's (ISM's) Non-Manufacturing (Services) Index climbed to 58.5 in August, one of its highest readings of the economic cycle. Purchasing Managers Index, a gauge of manufacturing health, rose to a 14-year high last month. With the services and manufacturing sectors firing on all cylinders, the U.S. economy could be poised for another strong quarter of economic growth. (LPL)

 

Costco says same store sales rose 9.5 percent in August. (Yahoo Finance)

 

S&P 500 is up 14 and the NASDAQ is up 37. The MSCI international index is lower.

Oil is up 29 cents at $68.04 a barrel.

Gold is down $3 at $1198 a Troy ounce.

 



The Labor Department says the US economy added 201,000 jobs in the month of August. The unemployment rate remains unchanged at 3.9%. This in conjunction with yesterday’s unemployment report of 203,000 new claims, the lowest level since 1969, shows just how red-hot the job market is.

The Great Oregon Wine Co. has purchased Duck Pond Cellars. The price wasn’t disclosed. Great Oregon is owned by Integrated Beverage Group. Duck Pond, focused on pinot noir and pinot gris. (PBJ)

U.S. trade deficit in July widened by $4.3 billion, the most since March 2015, to $50.1 billion. The U.S. trade deficit has widened for two straight months after $50 billion in tariffs on Chinese imports were implemented in early July. The widening deficit is further evidence of tariffs' economic drag, which we estimate will weigh on gross domestic product growth this year. (LPL)

Nation’s Restaurant News says 67 percent of restaurant operators “cited increased competition for workers as a key driver in rising costs.”

Join us this weekend for Financial Focus Radio. Tyler and I will discuss this week’s big tech selloff.

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



Doug Fisher, vice president of Intel's software group and a senior Oregon executive is retiring. Fisher, 57, is an Oregon State University graduate and has worked for Intel for 23 years. (Oregonian)

Delta Dental of California is investing $155 million for a 50 percent ownership stake in Portland-based health insurer Moda. Moda lost $10.1 million in the first half of the year.
Moda's lines of business include health and dental insurance, as well as a specialty pharmacy. (PBJ)

Mortgage Bankers Association says applications to purchase a home increased 1 percent for the week and were 2 percent higher than a year ago.

The Institute for Supply Management said its manufacturing index jumped to a 14-year high of 61.3%.

The Paychex Small Business Employment Watch for August shows a continued decrease in the rates of small business jobs and wage growth, it also reveals that weekly hours worked are on the rise. The top regions for employment growth and wage growth, respectively, are the South and West.

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



It's hard to believe, but we are officially in the month of September. Although this means football and cooler weather, it also means a historically poor month for stocks. Since 1950, September has been the worst month of the year for the S&P 500. The good news is when the S&P 500 starts September above its 200-day moving average (like 2018), the returns have been much better. (LPL)
 
The overall trend in CEO optimism has remained largely unchanged, maintaining favorable levels over the past year. In Q2 2018, the Vistage CEO Confidence Index was 104.1.
 
American Outdoor Brands reported an adjusted quarterly profit of 21 cents per share. The parent company of Smith & Wesson was helped by new products and reduced discounts. The company said it would have stronger than expected growth for the current quarter. (CNBC)
 
Uber will start operations in Eugene and Springfield next Thursday. (ERG)
 
Kah-nee-ta Resort & Spa will close for good on today eliminating 146 jobs. Kah-nee-ta opened in 1964. (Oregonian)
 
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart. 



We start a new month of trading this morning. Since 1950, the S&P 500 has been higher in April, May, June, July, and August only 5 times. 2018 was the 6th time. The good news? In the past instances the final 4 months have never been lower and the usually tricky September is actually quite strong. (LPL)

Personal income rose 0.3% in the month, reducing year-over-year growth to 4.7%. (LPL)

Core personal consumption expenditures (excluding food and energy), the Federal Reserve's (Fed's) preferred inflation gauge, rose 2.0% year over year in July, matching the Fed's target for the first time since 2012.

A federal agency has ruled that Canadian paper imports don't hurt American producers. This eliminates tariffs that had raised prices and squeezed margins at struggling newspapers. (Bloomberg)

The Portland headquartered General Steel Drum company has acquired North Coast Container of Cleveland, Ohio. General Steel Drum is owned by the Stavig family. Terms of the deal were not disclosed. (PBJ)

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



It is the last trading day of the month of August. The S&P 500's incredible summer rally continues, as U.S. stocks are on track to post their fifth straight monthly gain. The S&P 500 has also performed surprisingly strong this month, as its 3% gain is its second-biggest rally in August since 2000. (LPL)

The S&P 500 Index closed at a new all-time high for four consecutive days this week. The longest such streak since six in a row to start 2018. The all-time record for consecutive new highs was 12 in a row in 1929, while in more recent times there was a streak of 11 in 1964. Interestingly, this is the first time the month of August has seen four consecutive new highs since 1987. New highs in August are somewhat rare, as since 1950, no month has "fewer" new highs than August. (LPL)

Consumer spending grew 0.4% month over month in July, boosting its year-over-year growth to 5.2%, the strongest pace since October 2014. Consumer spending accounts for about 70% of economic output. (LPL)

Join us this weekend on this great station for Financial Focus Radio, the truth can wealth building. This way people talk about the coming bear market.

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



Same store sales at Dick's Sporting Goods stores tumbled 4 percent during the latest quarter. Dick's raised its profit outlook for the full year. Dick's said online sales increased 12 percent during the quarter. (Reuters)

The Mortgage Bankers Association said total home loan application volume decreased 1.7 percent last week.

Tailored Brands said it expects second quarter earnings to be better than expected. The parent of the Men's Wearhouse and Jos. A. Bank clothing chains also said Chief Executive would retire at the end of September. (CNBC)

GDP revision reinforces solid second-quarter growth. Gross domestic product growth was revised up to 4.2%. The contribution to output from business spending was 0.15% higher and the contribution from net exports was 0.11% higher. This puts us on track for GDP growth in 2018 to be at or above 3%. (LPL)

Hood River-based, Tofurky, the vegetarian food-maker, is suing Missouri to defend its right to describe its products with meat terminology such as "sausage" and "hot dogs. The Missouri Cattlemen's Assoc supported the new law banning plant based products from using the terms. (AP)

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

 



The Conference Board's consumer confidence index rose to 133.4 in August, its highest level since October 2000.
Consumers expecting business conditions will get better over the next six months increased to 24.3 percent.

In June, home prices nationally rose 6.2 percent year-over-year, according to the S&P CoreLogic Case-Shiller Indices. That is down from the 6.4 percent annual gain in May.

Campbell Soup will announce this week that it does not plan to sell the entire company, according to sources quoted by the New York Post.

Data for July showed the U.S. merchandise trade deficit widened to $72.2B, its biggest m-o-m increase since March 2015. Last month's growth in the trade deficit was driven by a sharp decline in exports, reflecting the impact of imposed tariffs over the past few months. (LPL)

Record short position, those speculating on the direction of rates in 10-year Treasury futures, has increased to its biggest size on record.

Oreo's parent company Mondelez announced that its two newest iterations of the cookie, hot chicken wing and wasabi-flavored, are now available in China. (Fortune)

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



Outstanding earnings season by many measures. Second quarter numbers were strong even without the boost from the new tax law, while guidance was generally positive despite tariffs and trade policy uncertainty. With just 15 index constituents left to report, S&P 500 Index earnings rose 25% year over year, nearly matching the 26% growth rate from the quarter before. Even without the boost from tax cuts (estimated 6-7%) earnings growth came in at a still-outstanding 18-19%. (LPL)

The S&P 500 just made its first new high in 7 months last Friday. Since 1950, the S&P 500 had gone more than 6 months without making a new high 18 other times. What happened after that first new high was made? It was higher a year later 17 times. (LPL)

Oregon has been a smoky place this summer and it comes with a cost. Wildfires have cost the Oregon Shakespeare Festival $2 million in lost revenue because of smoky conditions. (AP)

Oregon hazelnut farmers anticipate a bumper crop this fall and projects Oregon production will double over the next few years as newly planted planted acreage reaches maturity. (AP)

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



The Commerce Department said orders for U.S.-made capital goods increased 1.4 percent in July. Core capital goods orders increased 7.2 percent on a year-on-year basis.
 
If you were looking for relief on your state tax deduction you are going to be disappointed. The Treasury and IRS issued new rules to block high tax states' attempts to circumvent the new $10,000 cap on state and local tax deductions. (CNBC)
 
Procter & Gamble (PG) has applied to trademark millennial-friendly internet acronyms including "LOL," "WTF," "FML" and "NBD" for use on soap and cleaning products. (NY Post)
 
In the midst of the China currency and economic concerns of 2015, three years ago was the first time that the Dow ever fell 1,000 points. It didn't close down 1,000 points and on a percentage basis this wasn't the largest drop ever, but it was still a harsh reminder that volatility can come at any time. Only two other times in history has it dropped 1,000 points during the day and both of those were this past February. On a percentage basis, the Dow was down 6.62% at the lows three years ago today. The largest ever was 25.33% during the Crash of '87. (LPL)
 
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.



Short positions in Treasury futures were historically high just two months ago, and now they are 50% higher. Many of these short positions were put on over the last six months while the 10-year Treasury yield has hovered in its current 2.8-3.0% range. Yield moves meaningfully below that level could squeeze short positions, pressuring shorts to buy Treasury futures to cover their positions, which could pressure rates downward further. (LPL)

The Wall Street Journal reports that the unemployment rate for Americans ages 16-24 is at its lowest since 1966. The unemployment rate is 9.2 percent, down from 9.6 percent last year. However, the share of young people looking for work is below the peak hit in 1989.

Barron’s says that the “combination of last winter’s brutal cold and this summer’s droughts has hurt” the wheat crop. Prices will reach “levels not seen since 2012,” with the USDA predicting global wheat production will fall to 730 million tons.  

ValueInsured Modern Homebuyer Survey found that in Q3 2018 only 48 percent of Millennials see value in buying a home, a decrease from 54 percent in Q2. Housing “confidence and enthusiasm of Millennials has plummeted to a record low.”

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



Today the current bull market tops the 1990s bull market as the longest ever. However, be aware that the 1990s bull market saw the S&P 500 Index gain 417%, while the current bull market is up approximately 320%—so you can’t call this the greatest bull market…yet. (LPL)

The S&P 500 Index made a new all-time high yesterday its first since January 26, 2018 (LPL)

Treasury yield curve flattens back to decade lows. The spread between 10- and 2-year Treasury yields is now back below 25 basis points. This bout of flattening is mainly being driven by a modest decline in longer-term yields over the past two weeks (as opposed to a rise in short-term yields). With market expectations pricing in a 90% chance of a September rate hike and a 55% chance of a subsequent December hike, upward pressure on the front end of the curve has not waned, despite risk-off sentiment leading to long-end bidding. (LPL)

Nabisco-parent Mondelez has redesigned the packaging of its animal crackers, showing the animals roaming free instead of in cages, after pressure from PETA. (AP)

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



S&P 500 earnings growth is now tracking to +24.6% year over year for the second quarter. Revenue growth is tracking to +9.4% year over year. (LPL)

The Conference Board's Leading Economic Index increased 0.6% in July, its 26th consecutive monthly gain.  The LEI, which is a composite of 10 economic indicators (like manufacturers' new orders, stock prices, and weekly unemployment claims), shows that the economic expansion is still intact and healthy. The LEI is up 6.3% year over year. The longer-term trend in the LEI is especially important, as the LEI has turned negative YOY before every economic recession dating back to the 1970s. (LPL)

Guinness is opening the $90 million Guinness Open Gate Brewery & Barrel House Aug. 3 near Baltimore, its first U.S. brewery in more than 60 years. The attraction is expected to host 300,000 visitors a year. (CNBC)

Constellation Brands who for seven decades has made its money off beer, wine and whiskey, sees its future in marijuana. They will spend about $3.8 billion to boost its stake in Canadian grower Canopy Growth Corp., betting legalization will gain traction around the world and especially in the U.S. (FBN)

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



The S&P 500 Index posted its most volatile week since early June. The index was up about 0.3% for the week, posting and average daily move of 0.7% over the period. The S&P 500 has closed within 2% of record highs for 12 consecutive trading days, the longest such streak since September 2017.  (LPL)

Economic data a mixed bag. The Philadelphia Federal Reserve's business outlook survey fell to 11.9, a 21-month low. Housing starts grew 0.9% last month (missing expectations of 7.4% growth) after declining 12.3% in June, indicating cooling in U.S. new-home construction. Applications for unemployment benefits fell to 212k last week. The 4-week rolling average for jobless claims is now 214k, hovering near its lowest point of the economic cycle. (LPL)

Intel, Oregon’s largest employer, has purchased a three-year-old Seattle artificial intelligence startup called Vertex.AI. The terms of the deal were not disclosed.
(Oregonian)

SodaStream the Israeli-based at-home carbonated drink-maker agreed to be bought by U.S. beverage giant PepsiCo for $3.2 billion in cash, or $144 per share. (CNBC)

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



Concerns about global trade and Turkey shouldn't be dismissed as misplaced or paranoia. Though mostly currency driven, we have seen some signs of fundamental deterioration recently in the form of earnings estimate reductions for the MSCI EM Index. Specifically, over the past three months, EM estimates for the next 12 months have come down by 3.9%, while comparable S&P 500 estimates have risen 3.5%. (LPL)

Wholesale used-vehicle prices climbed 1.51% last month. The increase in prices lifted the Manheim Used Vehicle Value Index to 136.9, the highest level ever recorded by the auto auction company. The index is also up 5.1% in the past year.

The Wall Street Journal reports the USDA monthly world Agricultural Supply and Demand Estimates, forecast that US soybean production will reach a record-high 4.6 billion bushels in 2018-19.

Bloomberg says Amazon captured around five percent of retail spending in the US last year, excluding cars, car parts and restaurants and bars. Rival Walmart took around 10 percent of such spending. With Amazon’s revenue increasing its share of that spending may rise to six percent this year.

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



U.S. stocks halted a multiday tumble yesterday, with the three main equity benchmarks advancing as Turkey’s currency slide abated, allowing investors to focus instead on a healthy domestic economy and strong corporate results.

The National Federation of Independent Business small business optimism index rose 0.7 points in July to 107.9. The NFIB said it was the second-highest level in history and just under the 1983 peak.   The single most important issue flagged by small businesses were concerns about the quality of available labor.

The debt burden of U.S. households is the smallest it’s been in nearly 16 years.  Household debt — including mortgages, credit cards, auto loans, student loans and other credit, is $13.29 trillion, which relative to disposable income is the lowest it’s been in 16 years.
Home improvement retailer Home Depot reported earnings and revenue that beat expectations and upped their outlook. It is the continuation of a trend that has persisted for a few years: in the face of lean housing inventory and little new supply on the horizon, Americans are increasingly choosing to take matters into their own hands.

With Northwest Quadrant Wealth Management, I’m Tyler Simones



U.S. stocks closed lower yesterday, with the S&P 500 down for a fourth straight session as the ongoing turmoil in Turkey dampened investors’ appetite for riskier assets.

Don’t look now, but on August 22, 2018, this current bull market in stocks will top the 1990s bull market as the longest ever. However, be aware that the 1990s bull market saw the S&P 500 Index gain 417%, while the current bull market is up approximately 320%—so you can’t call this the greatest bull market…yet.

2nd Quarter earnings season is entering the final stretch. With more than 90% of S&P 500 Index companies having reported second quarter results, year-over-year earnings growth for the index is tracking to an impressive +24.4%, nearly 4% above expectations as of June

Shares of the food distribution giant Sysco were sharply higher yesterday after the food distribution giant reported a fiscal fourth-quarter profit and revenue that topped expectations.  Sysco’s stock has rallied 33% over the last 12 months.

With Northwest Quadrant Wealth Management I’m Tyler Simones



Turkey’s problems are spilling over into the broader markets this morning, as the Lira touched an all-time low against the dollar and plunged 13% overnight as Turkish president Erdogan called on citizens to convert their dollars and gold into Lira.  The Euro also touched a 13 month low against the dollar over concerns of European Banking exposure to Turkey.  

In Delaware, US Federal Judge Leonard Stark has authorized the seizure of Citgo Petroleum to satisfy a Venezuelan government debt owed to a defunct Canadian gold miner.  The ruling could likely set off a scramble among Venezuela’s many unpaid creditors to wrest control of its only obviously seizable U.S. asset, as Venezuela’s oil production continues to plummet.  

With us GDP growing at a 4.1% clip last quarter and the job market solid, consumer inflation has become the wild card for economists. The latest figure, which could be the highest in more than six years, will be released this morning by the Labor Department. Expectations are for CPI to have increased 2.3% Y/Y, and headline CPI (including food and energy) to have reached a 3% Y/Y pace for the first time since December 2011.

With Northwest Quadrant Wealth Management a Registered Investment Advisor I am Josh Fenili.



U.S. stocks closed mostly lower yesterday following a batch of weak earnings reports from high-profile firms such as Walt Disney and Snap.  However, the Nasdaq extended its winning streak to a fifth session as technology shares outperformed the broader market.

China just announced they are slapping additional tariffs of 25 percent on $16 billion worth of U.S. imports from fuel and steel products to autos and medical equipment, the Chinese commerce ministry said, as the world's largest economies escalated their trade dispute.

The CEO of Tesla, Elon Musk, famously tweeted earlier this week that he was considering taking the company private.  Now the Securities and Exchange Commission has made inquiries to Tesla over Elon Musk's going-private tweet, including examining whether the chief executive's statement was factual and why the disclosure was made on Twitter rather than on an official filing.  We are sure to hear more about this in the future.

As we near the end of earnings season, two trends are clear: Profits have gone through the roof, helped by lower corporate income taxes. But sales have also increased remarkably, and that trend started before the tax cuts went into effect.

With Northwest Quadrant Wealth Management, I’m Tyler Simones
 



The S&P 500 Index posted its second highest close ever yesterday, less than 0.5% away from a new all-time high. The S&P 500 has now gone 133 trading days (over six months), without a new high. Since the bull market started in March 2009, this is now the second longest stretch without a new high (the longest was May 2015 until July 2016). (LPL)

10-year hits the 3% wall. The 10-year Treasury yield has run up against the psychological 3% level yet again. After closing barely above 3% last Wednesday for the first time since May 22, the 10-year yield has steadily inched back down, currently trading near 2.95%. (LPL)

Tariffs are having little impact on overall earnings guidance. Forward four quarter estimates have impressively risen 0.6%. With less than 100 S&P 500 companies left to report (47 coming this week) suggests tariffs have had little broad impact on companies' outlooks. (LPL)

The Wall Street Journal reports employment in the manufacturing sector has increased since the end of the last recession in 2009, and growth has increased over 2018. Factory hiring is more than twice as strong this year as it was during January- July 2017.

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



With 404 S&P 500 Index companies having reported second quarter 2018 earnings results, a solid 79% have exceeded earnings targets, delivering robust 23.5% year-over-year growth on a nearly 3% upside surprise. Revenue growth of 9.2% is a solid 1.1% above expectations. (LPL)

S&P 500 on its hottest streak of the year. The S&P 500 capped its fifth straight positive week. The first such streak since the week ending Dec. 22, 2017. Five-week winning streaks are a rare feat of strength for the S&P 500: the index has posted 8 five-week winning streaks since February 2013 (and five 6-week winning streaks over that same period). The S&P 500 gained 0.8% last week.  (LPL)

More trouble for Wells Fargo. According to the Wall Street Journal it is under scrutiny from federal regulators over the bank's purchase of tax credits designed to fund low income housing.

The laws of economics still apply. Supply and demand rule the day. Oregon report enforcement found nearly 70 percent of the legal recreational marijuana grown goes unsold. (AP)

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



The Labor Department  says a record 155,965,000 people were employed in July, the 11th record-breaker since President Trump took office 19 months ago. The unemployment rates for adult men (3.4 percent) and Whites (3.4 percent) declined in July. The jobless rates for adult women (3.7 percent), teenagers (13.1 percent), and Blacks (6.6 percent) showed little or no change. The unemployment rate for Hispanics hit a record low of 4.5 percent. The labor force participation rate, at 62.9 percent in July, was unchanged. Hourly earnings rose by 7 cents to $27.05. For the year, hourly earnings have increased by 71 cents, or 2.7 percent.

Milwaukie, Oregon-based Bob's Red Mill Natural Foods says that Bob Moore will give up the CEO title 40 years.
Dennis Vaughn, the company's chief operating officer and vice president of operations, will take over as CEO. Moore, 89, founded the company in 1978. (PBJ)

Forbes contributor Jon Bird says consumers are “turning a blind eye to the environmental cost of online retail, particularly when it comes to packaging.” For instance, Blue Apron “sends out around 8 million meals a month, each one containing two six-pound ice packs,” and the “freezer pack waste is about 192,000 tons per year.”

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



The US economy added 157,000 jobs in July according to the US Department of Labor. The unemployment rate stands at 3.9%.

Global manufacturing activity is slowing. Markit's global purchasing managers' index slipped to a still expansionary 52.7. Eurozone activity held steady. China's reading slowed for the second straight month, which reflects some impact from ongoing trade disputes. (LPL)
The official ISM Manufacturing Index in the U.S. came in at 58.1 in July, adding to evidence that tariffs and risk of escalation are beginning to impact US manufacturers. However, this reading is still quite strong. (LPL)

U.S. and EM still look like better bargains than Europe. The S&P 500 Index is trading at a reasonable 16.5x earnings estimates for the next four quarters, 2% above the post-1995 average. The MSCI Emerging Markets Index, at 11.5x, is trading 3% below its average for this period. Europe, at 14x, is trading 12% above its 23-year average which, given that market's relatively more defensive sector mix, is expensive.

Join us this weekend for Financial Focus Radio. Check listings at www.financialfocusrasdio.com .

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



U.S. stocks traded mostly lower yesterday after the Federal Reserve left interest rates unchanged but signaled another imminent rate increase.  Fresh worries over the U.S.-China trade friction dampened investor sentiment although positive results from Apple buoyed the tech sector and helped the Nasdaq to keep a foothold in positive territory.


According to the payroll company ADP companies in the private sector added 219,000 new employees to their payrolls in July, showing that firms are managing to fill a record number of job openings despite growing shortages of skilled labor.


According to data from S&P Dow Jones Indices, 80% of the S&P 500 stocks that have reported second-quarter earnings so far have topped profit expectations, well above the historical average of 67%.


Car maker Tesla reported 2nd quarter earnings losing more than expected.  Tesla said they lost $718 million, or $4.22, in the quarter, compared with $336 million, or $2.04 a share, in the year-ago period.  The company continues to have a very high cash burn rate.

With Northwest Quadrant Wealth Management, I’m Tyler Simones



US Stocks traded lower yesterday, led lower by the tech heavy NASDAQ which closed at it's lowest level in 3 weeks.
 
Shares of heavy equipment maker Caterpillar traded higher yesterday after the company reported 2nd quarter earnings that rose from a year ago which was a surprise as investors had expected the recently imposed tariffs to hurt CAT's earnings.
 
Shares of the food company Tyson Foods traded sharply lower after the company cut their full year profit guidance on trade uncertainties related to tariffs and volatility in commodity prices.
 
And according to the National Association of Realtors, pending homes sales in the US rose 1% in June which was better than expected.  The housing market increasingly appears to be running on fumes as demand continues to overwhelm supply.

With Northwest Quadrant Wealth Management I'm Tyler Simones



US Stocks closed lower Friday, but were higher on the week thanks to a slew of good earnings reports from some of America's biggest companies.
 
This week will be another busy week for the markets as investors get the July jobs report on Friday and Apple, Tesla and hundreds of other companies earnings reports this week.  All told investors will have to digest 12 major economic reports this week that could be market movers.
 
The Federal Reserve is expected to raise interest rates this week as the have said the economy is growing strongly and inflation is at their 2% target making more rate hikes this year likely.
 
US Consumers are paying more for products from R.V.'s to soda as tariff's on metal and parts are putting pressure on US manufacturers. US Steel and aluminum prices are up 33% and 11%.
 
With Northwest Quadrant Wealth Management I'm Tyler Simones
 



The Commerce Department said orders for non-defense capital goods excluding aircraft rose 0.6 percent last month. Business spending on equipment has risen since the fourth quarter of 2016. Business spending on equipment is being supported by the Trump administration's $1.5 trillion income tax cut package, which came into effect in January.

Mattel lost 56 cents per share last quarter. The toy maker’s revenue also missed forecasts, hurt by the Toys R Us liquidation. The company will be cutting 2,200 jobs or about 22 percent of its global non-manufacturing workforce. (CNBC)

U.S. economy remains the standout. The dip in Japan's manufacturing purchasing managers' index last month (to 51.6), coupled with stronger readings and slight increases month over month in the U.S., continue to point to the U.S. as the global growth leader. However, Europe's reading (55.1), which is in line with the U.S. (55.5), did stabilize after a sizable drop earlier this year while broader data in Europe has improved in recent months relative to expectations. (LPL)

Join us this weekend for Financial Focus Radio. Check listings at www.financialfocusrasdio.com .

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



Manufacturing data shows solid growth, but evidence of tariff impacts have started to emerge. The U.S. purchasing managers' index (PMI) data was 55.5. However, average prices charged grew at the fastest pace on record amid increases in input costs, as survey respondents noted higher raw material and fuel costs. Suppliers' delivery times were also the longest on record amid low inventory and capacity constraints, showing that supply chain constraints are causing significant disruption. While manufacturing growth has been strong this year, the surge in prices and supply chain disruptions could curb further economic activity. (LPL)

The Commerce Department reports new home sales dropped 5.3 percent month, the lowest level since October 2017. The median new house price fell 4.2 percent to $302,100 in June from a year ago. There were 301,000 new homes on the market in June, up 1.7 percent from May. Supply is just over half of what it was at the peak of the housing market boom in 2006. Nearly two-thirds of the houses sold last month were either under construction or yet to be built.

The Mortgage Bankers Association says volume was 12.6 percent lower than a year ago. Mortgage applications to purchase a home is 2 percent higher than last year.

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



It is the busiest week of earnings season. The Dow has a three-day losing streak, but the S&P 500 is coming off its first gain in three days and the Nasdaq saw its first gain in four sessions yesterday. (CNBC)

Consensus estimates are calling for a 21% year-over-year increase in S&P 500 Index earnings for the quarter, setting up a second-straight quarter of 20+ growth. Should results come in ahead of expectations, it would mark the 37th consecutive quarter of earnings exceeding expectations. Tax cuts, strong manufacturing activity, a weaker U.S. dollar and higher oil prices all point to strong results. With 87 S&P 500 companies having reported, the season is off to a good start: 84% of companies have exceeded earnings estimates. (LPL)

Papa John’s has adopted a shareholder rights plan which would be implemented if a shareholder amasses a 15 percent stake in the company. The plan is designed to prevent a shareholder from gaining control of the pizza chain and is seen as a move to thwart founder John Schnatter from taking control. (CNBC)

Alphabet reported a profit of $11.75 per share. Revenue rose 25 percent yoy, helped by a 58 percent jump in paid clicks. (CNBC)

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



President Trump said he is ready to go with tariffs on $500 billion in Chinese imports in an effort to drive an agreement. Tariffs on just $34 billion in Chinese goods have been implemented thus far, with $16 billion coming soon and an additional $200 billion previously threatened. With China only buying about $130 billion in U.S. goods, Chinese retaliation would have to come in other forms, such as regulatory actions, boycotts, currency devaluation, U.S. Treasury sales, or other non-tariff actions. These latest developments may bring the tit-for-tat closer to its end, though resolution may take the bulk of the summer. (LPL)

The Conference Board's Leading Economic Index (LEI), one of our favorite economic indicators, painted a continued strong backdrop for future economic growth, as it rose 0.5% month over month and 5.8% year over year. While the yield curve has been getting all the attention recently, the LEI has a solid track record of predicting recessions. (LPL)

Cal-Maine Foods, the nation’s largest egg producer posted a quarterly profit of $1.48 per share. Cal-Maine said the market may see additional pricing pressure to due to an expected increase in the U.S. laying hen flock and potential excess egg supply. (CNBC)

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



Business confidence remains strong based on the latest survey data from the National Federation of Independent Business. The percentage of small business owners indicating it is a good time to expand dipped slightly from May to June but remains above the peaks of the past three decades. Strong data from the Institute for Supply Management tells the same story, even though all Federal Reserve (Fed) districts cited concerns about the continued tightening of the labor market, inflationary pressures, and tariffs in the Fed's Beige Book. (LPL)
 
The Dream on Hold, a study by RENTCafe reports that families are “being squeezed into rental properties.” Data shows that homeownership by families decreased by nearly 3.6 million over the last decade, while the number of families living in rentals increased by 1.9 million. 
 
More than 12.8 million Americans are currently working in the US manufacturing industry. The last time that many Americans were working in manufacturing was back in December 2008. (Breitbart)
 
RLK and Company, which owns Timberline Lodge has purchased Summit Ski Area which sits just off U.S. 26 in Government Camp. Neither party disclosed the purchase price. (OregonLive)
 
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.    
 


Industrial production in June rose 0.6%, reversing a 0.5% decline in May. Manufacturing output climbed 0.8%, the most in four months and capacity utilization continued to rise. The rebound in industrial production is a signal of economic growth and could help lift the second-quarter gross domestic product (GDP). Currently, the Bloomberg consensus for the second-quarter GDP is 4.0%. (LPL)
 
According to the Association of Equipment Manufacturers equipment sales in the first half of 2018 are up sharply over last year, led by a 20.5% increase in combine sales. Total tractor sales for 2018 so far are up 6.5% compared to the first half of 2017.
 
Berkshire Hathaway eliminated its own restrictions on buying back the company’s stock. A new policy allows buybacks to be authorized when Berkshire’s Warren Buffett and Charlie Munger feel the repurchase price is below Berkshire’s intrinsic value. (Reuters)
 
The Commerce Department said U.S. homebuilding fell to a nine-month low in June and permits declined for a third straight month. Housing starts fell 12.3 percent. Building permits dropped 2.2 percent. Single-family homebuilding decreased 9.1 percent. Starts for the volatile multi-family housing segment plunged 19.8 percent.
 
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.                                      
 


The Eager Report says entrepreneurs registered 301 new businesses in Bend in June a 21% increase over registrations in June 2017. Bend continued to lead the way in large city business registrations, with one business registered in February for every 303 residents, the highest rate of business registration among larger Oregon cities. Statewide, the average was a new business for every 690  residents.
 
According to the Bureau of Economic Analysis foreign investors spent $259.6 billion to acquire, launch, and expand businesses in the United States in 2017. That's down from a historic high of $439.5 billion in 2015. The largest of last year's foreign investment came from Canada, followed by the United Kingdom and Japan. (CNN)
 
Investment in the global energy sector totaled $1.8 trillion in 2017, marking a 2 percent drop from the previous year. A drop in spending on power plants offset a moderate increase in money flowing into the electric grid. (CNBC)
 
The USDA released its World Agricultural Supply and Demand Estimates. It estimates soybean stocks for 2018-19 at a record 580 million bushels, up about 50 percent from its previous estimate.
 
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Troy Reinhart.                                      
 



The Labor Department said U.S. producer prices increased 0.3 percent in June. In the last 12 months the PPI is up 3.4 percent, the largest gain since November 2011. Inflation is gradually rising against the backdrop of a labor market that is near or at full employment.

Oregon placed 19th in the CNBC best states for business, that is down two spots from last year. The report says, “The Beaver State has a great economy, but heavy regulation holds back business success.” In the factors considered Oregon did not score any A’s and got an F for cost of living and D+ for business friendliness.

Workers are leaving their jobs at the fastest rate since the Internet boom and they are landing higher pay and more satisfying work as a result. According to the Labor Department, 3.4 million Americans quit their jobs in April. Workers are emboldened by the strong economy and low unemployment.

Trucking companies increased rig orders by 18.5% in June over May, according to data from ACT Research. Big rig orders are driving factory backlogs to their highest levels in almost twenty years, and the June 2018 rig orders are roughly double the number ordered the previous June.

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



NFIB’s Small Business Optimism Index for June was the sixth-highest reading in survey history. The index saw a 0.6-point decrease to 107.2. Since December 2016, the Index has averaged 105.4, significantly above the 45-year average of 98 and nearing the all-time high of 108.0 in July 1983.
 
Bizwomen reports customers who tried but were unable to purchase a product at a physical store because it was out of stock account for more than 20 percent of Amazon’s North America sales. IHL Group found Amazon Prime members who can’t find what they want in a store are 52 percent more likely than other consumers to buy what they need online.
 
NFIB reports the share of US firms with open positions rose to 36 percent in June, matching November 2000 as the highest in monthly records back to 1973. Twenty-one percent of small-business owners said finding qualified workers was their biggest problem, also near a record level.
 
Kah-Nee-Ta Resort & Spa, owned by the Confederated Tribes of Warm Springs is closing and will permanently lay off 146 employees. The closure includes the lodge, spa, hotel and RV park. (PBN)

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



One of the most popular market-related discussions recently is on the yield curve. The reason being the yield curve (as measured by the 2-10 year Treasury spread) is at its flattest level since right before the financial crisis. Also, the past nine recessions have all been preceded by an inverted yield curve. It is important to note that the yield curve is not currently inverted, but that hasn't stopped the masses from focusing on it. Here's the catch, looking at the past five recessions shows that a recession didn't officially start until an average of more than 21 months after the yield curve initially inverted. The S&P 500, meanwhile, added an average of nearly 13% over this timeframe and was higher in every single instance.
(LPL)

Shopping malls across the U.S. haven’t been this empty in six years. The mall vacancy rate for the second quarter is 8.6% up from 8.4% in Q1. Retailers such as, Sears, J.C. Penney and Toys “R” Us have all announced closures this year. (LINKedin)

Pepsi reported quarterly earnings. Their snack business, which includes brands like Doritos and Tostitos, grew 4 percent. Its North American beverage business, which includes Gatorade and its namesake cola, dropped 1 percent. Total revenue rose 2.4 percent. (CNBC)

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



Ford's slump in China intensified, with vehicle sales tumbling 38 percent in June and the automaker recording its worst ever first-half there as buyers shunned its aging models. (Reuters)

Roughly 70 percent of all Chinese fireworks entering the United States come here under the control of a Chinese businessman who has used his influence to raise prices and block competitors. The average daily fireworks containers shipped from China to the US in April and May of 2018 was 108. That is 241 million pounds of fireworks. (Wash. Post)

Home prices jumped 7.1 percent annually in May, according to CoreLogic. That's the biggest jump in four years. The median price of an existing home sold in May was $264,800. The supply of homes for sale has been dropping on an annual basis for the past 36 months.

Manufacturing remains a bright spot. The June ISM Manufacturing Index came in at 60.2, better than last month. The bottom line is the trade concerns didn't appear to slow down manufacturing. Manufacturing is about 10% of the overall gross domestic product. (LPL)

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



The U.S. and China slapped levies on $34 billion of each other’s exports, the first tangible shots in a trade battle that both sides are bracing to fight for months—if not years.  The new levies took effect after midnight Eastern Time in the U.S. In response, a commission of China’s State Council said it applied tariffs on 545 items “including agricultural products, vehicles, and aquatic products,” according to state-run Xinhua News Agency.  (WSJ)
 
A better than expected jobs report this morning: the unemployment rose to 4% in June, ticking up from 3.8% from the month before. While economists had expected the jobless rate to hold at that level--the lowest since 2000--the increase was largely due to 601,000 Americans entering the labor force. (FT)
 
The EU is preparing a new list of duties against the U.S. in case President Trump moves ahead with tariffs on European cars, FT reports. It reportedly includes levies worth €18B, which will target staples like ketchup, as well as frozen fish, raisins, suitcases and adhesive bandages.
 
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Josh Fenili.



Oregon tech company Radisys, has been sold for $74 million to Reliance Industries Limited. Radisys sells communications networking equipment. Radisys had 600 employees at the end of last year. Just 50 were left at its Hillsboro headquarters. (Oregon Live)

The State of Oregon projects that Central Oregon will have fastest job growth in the state over the next ten years. If you've tried to hire a contractor lately, you won't be surprised to learn that the biggest job growth is projected in construction. (Eager Law)

Boeing is acquiring the commercial aircraft arm of Brazilian plane maker Embraer for $4.75 billion. (Reuters)

Amazon says its annual Prime Day will begin on July 16 and run for 36 hours. Prime Day will include deep discounts at Whole Foods. (CNBC)

Oregon is beer happy so this may have some appeal. The typical alcohol content in beer is between 4 and 8 percent, but for $200 per bottle, Samuel Adams offers a deluxe beer that packs 28 percent alcohol content. That translates to 56 proof, the same as Amaretto. The brew is illegal in 15 states. (CNBC)

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



Welcome to the third quarter. Historically the third quarter can be tricky for stocks, but especially so during a midterm year. In fact, going back to 1896 and the start of the Dow, this is the second worst quarter of the four-year presidential cycle. (LPL)

The shortened holiday week will likely see below-average trading volume with traders heading to beaches and barbecues. But that does not mean the economic calendar is quiet. In fact, quite the opposite with the ISM manufacturing data and the jobs report on Friday. (LPL)

The 2018 2Q Zillow Home Price Expectations Survey, found that surveyed economists and real estate experts expect the U.S. will enter a recession in 2020. (FBN)

Too early to think of Christmas? Not for Kohl’s, which is getting a jump on finding seasonal workers for the back-to-school and holiday seasons. Faced with a tight labor market, the retail giant says it’s the earliest it has ever started searching for seasonal employees. Although Kohl’s hasn’t disclosed how many workers it plans to hire, about 70,000 additional workers were employed for the 2015 and 2016 seasons. (LinkedIn)

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



Toys R Us closed its doors in the U.S. on Friday. The defunct company still must sell its intellectual property. (CNBC)

Nestle is being urged by investor Daniel Loeb’s Third Point hedge fund to split into three divisions. They want Nestle to split into separate beverage, nutrition, and grocery units. (CNBC)

Kroger the parent company of the Fred Meyer is about to test a fleet of driverless cars designed to lower delivery costs. Customers will be able to order groceries from a mobile app. After the order is placed, a driverless vehicle will deliver the groceries at a curb, requiring the customers to unload. The vehicles will be opened with a numeric code. (Oregon Live)

Oregon workers earning the minimum wage got a raise yesterday. The minimum wage in the Portland climbed 75 cents, to $12 an hour. In Deschutes and Lane County minimum wage climbed to $10.75 and hour. In the rest of eastern Oregon minimum wage rose to $10.50 an hour. Sunday's increase is the second in a series of annual hikes approved in 2016. Oregon has one of the highest minimum hourly wages in the nation. (Oregon Live)

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



More trade tensions are in the making on reports that Justin Trudeau will mark Canada's 151st birthday on Sunday by imposing tariffs on about C$19.4B worth of U.S. imports and providing aid to trade hit industries. The proposed tariffs will target metals, whiskies, mustard, toilet paper, washing machines, motorboats and maple syrup, in response to the American levies on Canadian steel and aluminum that went into effect a month ago.  (SA)

The debut of Walgreens into the Dow Jones Industrial Average this week marks the worst performance of any new entrant in the past decade. Shares are down more than 11% in the past three days - trimming more than 44 points off the index - after the company replaced GE. Walgreens also tumbled along with other drug retailers yesterday as Amazon made its entry into the industry by acquiring online pharmacy PillPack. (FT)

It's official! Twenty-First Century Fox shareholders will vote on Walt Disney's (NYSE:DIS) revised $71B bid for Fox's entertainment assets on July 27. The date effectively sets a deadline for Comcast to come back with a higher bid. Disney has already won DOJ approval for the deal on condition it sells 22 of Fox's regional sports networks. (WSJ)

S&P 500 futures are up 10 and NASDAQ futures are up 26. The MSCI international index is up 2/5 of a %.
Oil is up $.02 at $73.47 a barrel.
Gold is up $1 at $1252 a Troy ounce.
With Northwest Quadrant Wealth Management, a Registered Investment Advisor I am Josh Fenili.

 



The debt load for U.S. corporations has reached a record $6.3T, this according to S&P Global, as Wall Street investors brace for a stricter rate environment even as cash hoarding reaches a peak. The good news is that U.S. companies have a record $2.1T in cash to service that debt, however most of that cash is in the hands of a few giant corporations. (S&P)

 

Amazon is building out its own last-mile delivery service, pushing further onto the turf of shipping partners UPS and FedEx. The new program, called Delivery Service Partners, will let entrepreneurs run their own local delivery networks of up to 40 delivery vans emblazoned with Prime logos. (SA)

 

Today beings part 2 of the Fed’s annual bank stress tests, when lenders will learn whether they can boost buybacks and dividends to shareholders. Goldman Sachs and Morgan Stanley barely squeaked by on the first part last week, and some analysts remain concerned about Wells Fargo and Deutsche Bank.  The results come as the S&P 500 Financials Index fell for a 13th straight day on Wednesday - the longest losing streak on record - amid trade war worries and rising interest rates. (WSJ)

 

S&P 500 futures are down 2, and NASDAQ futures are down 9.  The MSCI international index is down about 1/5 of a %.

Oil is down $.23 at $72.53 a barrel. 

Gold is down $3 at $1253 an ounce.

With Northwest Quadrant Wealth Management, a Registered Investment Advisor, I'm Josh Fenili.



LEI continues to support a strong economy. The Leading Economic Index jumped 0.2% in May, after being up 0.4% each of the past two months. This index comprises 10 components (e.g., jobless claims, factory orders, and confidence) to show a picture of future economic health. This is key indicator we use as a warning sign for a pending economic slowdown, and fortunately we see little reason to expect a recession over the next 12 months. Year over year, this index is up +6.1%, well above the negative year-over-year signal that has preceded every recession going back to the early 1970s. (LPL)

 

Banks pass stress tests. Round one of the Federal Reserve's required testing for banks deemed "systemically important" to determine how they'd fare under severe economic conditions showed all 35 institutions received a passing grade for required capital minimums; though a few firms cleared the hurdle by a relatively small margin. (LPL)

 

UPS and the Teamsters have reached a tentative agreement on a new five-year labor contract. The prior agreement expires on July 31. (CNBC)

 

General Electric near a sale of its industrial engine unit to private equity firm Advent International. (CNBC)

S&P 500 is down 11 and the NASDAQ is down 60. The MSCI international index is lower.

Oil is up 31cents at $68.90 a barrel.

Gold is up $1 at $1271 a Troy ounce.

 

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



Mid Oregon Credit Union has acquired Bend-based High Desert Bank. High Desert Bank opened 2007. Its five employees have been offered jobs at Mid Oregon. Mid Oregon has seven branches in Central Oregon. (Bulletin)

OPEC may ramp up production. OPEC and Russia meet today in Vienna amid speculation that Saudi Arabia will get its 600K barrel/day output increase. Though likely, disagreement among several key members and the inability of secondary players to reach production targets introduce uncertainty. We see countervailing forces keeping oil prices largely range-bound near current levels, but strong global demand, geopolitics, and U.S. infrastructure bottlenecks offer the potential for a reversal of recent weakness. (LPL)

Foreign stocks getting cheaper. Recent underperformance by international stocks has helped those stocks get cheaper. On a forward price-to-earnings basis, the price-to-earnings multiple on the MSCI EAFE (developed international benchmark) has dropped from 15 to 13.7 this year. However, stronger earnings in the U.S. have led to a bigger drop in U.S. stock valuations, from 18.2 to 16.5. (LPL)

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



Americans applying for government disability benefits is plunging, evidence that a stronger economy is pulling people back into the job market (NY Times)

The 334.3 million mobile phones shipped during the first quarter of 2018 was a 2.9 percent decline year over year and was led by China, which declined to a level not seen since 2013. (IDC)

The National Association of Realtors say existing home sales slipped 0.4 percent last month. It was the second straight monthly decline in sales. Existing home sales, which make up about 90 percent of U.S. home sales, dropped 3.0 percent on a year-on-year basis in May. They have declined for three straight months.

Darden Restaurants', owners of the Olive Garden, saw quarterly results top Wall Street expectations. Darden earned $174.5 million, or $1.39 per share, up almost 41%. Revenue increased to $2.13 billion. Sales at Olive Garden restaurants open at least a year rose 2.4% in the quarter.

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



The Commerce Department said U.S. homebuilding surged to near an 11-year high in May up 5% from last month. Building permits fell 4.6%, the lowest level since September 2017.

Barron’s reported fewer than half of US consumers look past the first five options, or the first page of results, at least half the time when searching for products on ecommerce sites.

Research published by Cowen & Co. found the amount of retail overlap between traditional retailers and online commerce continues to trend upwards. Cowen found that 87 percent of Target shoppers also visited Amazon, while 83 percent of Walmart consumers also shopped on the online platform.

The combined wealth of the world's millionaires rose for a sixth straight year, topping $70 trillion for the first time ever in 2017 thanks to an improving global economy and strong stock market performance. (USA Today)

General Electric is being dropped from the Dow after being included in the 30-stock index for 111 years. It will be replaced by drugstore chain operator Walgreens Boots Alliance. (CNBC)

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



Capex has been rebounding and has the means, motive, and opportunity for a sustained run. We are seeing on-going signs of a rebound in business spending and investment and believe the trend is likely to continue. Lower tax rates and the brining home of foreign profits are giving businesses the means to invest; business confidence and a tight labor market are providing the motive; and provisions in the tax law incentivizing capex and a still solid global growth backdrop are providing the opportunity. This could produce a sustainable pick-up in economic growth and the possible extension of our 2.75-3.0% 2018 growth estimate later into the cycle. (LPL)

At the close yesterday, the Dow was up about 1.5% for the month and S&P 500 up about 2.5% for the month, with the Nasdaq up more than 4% for the month. The Nasdaq is up about 12% in 2018, with the S&P is up nearly 4% and the Dow is up 1.5% year-to-date. (CNBC)

Foreign governments reduced their purchases of U.S. debt by about $5 billion each for March and April. Most notable was Russia, which sliced its holdings of U.S. debt nearly in half from March to April, from $96.1 billion to $48.7 billion. Foreigners held $6.17 trillion of the total $14.84 trillion of Treasury debt outstanding through April. The national debt is more than $21 trillion. (CNBC)

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



U.S. rolls out tariffs on Chinese goods. President Trump approved a list of more than 1,100 items expected to generate ~$50 billion in taxes on Chinese imports, with an additional $16 billion in goods still under review. Collection is slated to begin in three weeks. The value of the tariffs suggests this is another negotiating tactic. (LPL)

The East Coast-based clothing chain Brooks Brothers has closed its downtown Portland store. It opened in 2008. The Portland store was Brooks Brothers' only Oregon location. (OBN)

Kellogg is recalling 1.3 million cases of Honey Smacks cereal due to potential salmonella contamination. (Reuters)

Apple has signed a multiyear deal with Oprah Winfrey as part of the tech giant's push into original content. Winfrey will create original programs. Apple has reportedly committed $1 billion to original content. (CNBC)

If you were looking for another reason to fly first class, Alaska Airlines is now serving ice cream from the Portland-based Salt and Straw. (Oregon Live)

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



According to Fannie Mae’s Home Purchase Sentiment Index for May, the rapid rise in home prices is resulting in a divergence in consumer attitudes toward buying and selling a home. Those who said that “now is a good time to sell a home” rose to 46% up 14 points over the year before, while those “who said now is a good time to buy a home decreased to 28%. (Mortgage Orb)

Strong retail sales for May point to accelerating second quarter growth. Consumer demand picked up steam in May as retail sales rose 0.8% versus April and up 6.4% year over year. The increase was broad based with 10 of 13 categories showing growth, including building materials with a 2.4% increase. The data are a clear sign that consumer spending has picked up nicely after a soft first quarter. (LPL)

New applications for unemployment benefits fell unexpectedly last week, coming in at 218,000. The labor market is considered to be close to full employment and the data further affirms our view of a strong and gradually tightening labor market. (LPL)

Microsoft is developing technology to eliminate cashiers and checkout lines from stores. Challenging Amazon's automated grocery stores. (Reuters)

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



Surging fuel costs spur wholesale inflation. Producer prices rose more than expected last month, up 0.5% from April and 3.1% year over year, to more than 6-year highs. Growth in the headline reading was driven primarily by rising fuel costs, as wholesale gasoline prices spiked 10% from the prior month. When stripped out, core inflation rose a more modest 2.3% from a year ago. (LPL)

Consumer inflation ticks higher. The year-over-year rate of growth in the consumer price index (CPI), was 2.8%, bested consensus expectations for a 2.7% as energy costs continued to rise. Meanwhile, the core reading, which strips out the more volatile food and energy components, held steady month over month at +2.1% as medical care services and auto prices rose, while growth in transportation costs moderated. (LPL)

Small Business Optimism Index Continues Historic Highs. NFIB’s Small Business Optimism Index for May was the second-highest in the 45-year-history of the survey. The index saw a three-point gain, rising to 107.8. Positive earnings trends reached a survey high, and positive sales trends are at their highest level since 1995.

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



Today the Federal Reserve is expected to raise interest rates by 0.25%. That news comes at 11 am.

The expansion turns 9. The economic expansion officially turns 9 years old this month, making it the second longest behind the 10-year expansion during the 1990s. (LPL)

Daimler Trucks North America will invest millions on an automated truck research and development center in Portland. The facility will be located at the company's Swan Island headquarters. (PBJ)

IHOP has announced its new name – IHOb. To promote the debut of the brand’s new Ultimate Steakburgers, the company is flipping the “P” in its name – which stands for pancakes – to “b” for burgers. However, the name change is only for the “time being,” with no set date for the return of its classic branding. (FBN)

H&R Block earned $5.43 per share for its first quarter. The tax preparation firm also saw sales beat forecasts. They raised their quarterly dividend by 4 percent to 25 cents per share. (CNBC)

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



U.S. stock-market indexes traded moderately higher yesterday ahead of a highly anticipated summit between President Donald Trump and North Korean leader Kim Jong Un in Singapore and a litany of potentially market-moving central-bank meetings.

Home Depot plans to spend $1.2 billion over the next five years to speed up delivery of goods to homes and job sites as the rise of online shopping resets consumer expectations.  The home improvement retailer will add 170 distribution facilities across the U.S. so that it can reach 90% of the U.S. population in one day or less.
U.S. factory orders fell by 0.8% in April, somewhat higher than expected. Economists had forecast a 0.5% drop. The decline was concentrated in commercial aircraft. Orders for nondurable goods also rose slightly.

The International House of Pancakes AKA IHOP is probably getting exactly what it wanted when it decided to change the name of the pancake chain to IHOb to celebrate its launch of a new line of burgers.  The company changed the P to B for burgers and has been getting plenty of press.  It seems gimmicks are the new form of marketing…
 



Global PMI data reflects broad global strength with U.S. taking the lead. Measures of U.S. manufacturing activity have broken away from the global pack to the upside while the European manufacturing sector has slowed over the past couple of months. Still, recent Markit Purchasing Managers' Index (PMI) data indicates a solid 80% of countries are in expansion. (LPL)

The trade deficit narrowed by $1.0 billion in April, its second straight decline, to $46.2 billion, marking the smallest deficit since September 2017. The reduction in April was driven by a smaller goods trade deficit, while the services surplus was little changed. However, on a 12-month total basis, the trade deficit widened marginally to $573.1 billion, the biggest gap in nine years, with deficits with China and Europe hitting records.
(LPL)

Kraft-Hines, the fifth-largest food and beverage company in the world with a market cap of $71 billion has created a “Legal-Ade” unit to help kids fight any legal issues or fines associated with lemonade stands. Any child fined for running a lemonade stand without a permit can have his or her parent apply for reimbursement. Each submission will then be reviewed by Country Time Lemonade’s team. (FBN)

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



U.S. stocks struggled for direction yesterday, with major indexes paring an early advance with the Nasdaq down firmly as major technology stocks sold off.  That was offset an uptrend in banking stocks.

The CEO of Berkshire Hathaway, Warren Buffet, and JP Morgan’s CEO Jaime Dimon wrote an OP ED piece in the WSJ calling for America’s public companies to stop making quarterly profit forecasts.  Buffet and Dimon said the quarterly earnings guidance leads to an unhealthy focus on short-term profits and the expense of a good long-term strategy.

Shares of Costco traded higher yesterday, after the company reported May sales showing same-store sales were up 14% to $11.02 billion from $9.66 billion in the same month a year ago. E-commerce sales were up 34.4%, the company said. In the U.S. the strongest regions were the Midwest, Texas and the Southeast, while internationally, Mexico, Japan and Taiwan were standouts.

Jobless claims were 222k last week and the rate of layoffs in the economy are at 50 year lows as the labor market continues to be on fire.



April figures show that the number of job openings, at 6.7 million, topping the number of unemployed people (6.3 million) for the first time in the report's 18-year history. Openings in manufacturing and services increased, though the number of hires was little changed. Labor turnover remained fairly static overall. Net employment rose 2.4 million for the month, indicating the labor market continues to tighten as the economic cycle continues to progress. (LPL)

Both ISM non-manufacturing and Markit services came in better than expected, with backlogs in non-manufacturing orders hitting a record high and growth in services activity accelerating at rates not seen in three years. Inflation pressures increased as input costs rose, but robust demand and the order backlog, in conjunction with a tight labor market, point to continued upside for the U.S. economy. (LPL)

Applications to refinance a home loan are 17 percent lower than a year ago. Mortgage applications to purchase a home are 9 percent higher than a year ago. The adjustable-rate mortgage share of activity increased to 7.1 percent of total applications. (Mortgage Bankers Association)

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



This week has saw continued strength under the surface. In fact, the Russell 2000, Russell Microcap, technology sector, and Nasdaq all closed at new all-time highs. Not to be outdone, various advance/decline lines made new highs as well including: the S&P MidCap, Nasdaq 100, NYSE, NYSE common stock only, S&P 100, S&P small cap, and S&P 500. (LPL)

Treasury futures remain at historic net short levels. The positioning indicates market participants believe yields will move higher. However, this has been an important counter-cyclical indicator, as profits (or losses) on these positions can lead to buying Treasury futures to close them out, leading to a decline in interest rates over the short term. (LPL)

The Oregon Treasury has decided not to give public employees a choice in how a portion of their retirement savings is invested. The agency decided the move could leave investment managers open to lawsuits if things don't go well. (Oregon Live)

Hobby Lobby opened its first store in Portland last weekend. Hobby Lobby's first Oregon store opened in 2014 and has four other Oregon locations, in Bend, Springfield, Albany and Salem. (Oregon Live)

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



Oregon is known for loving recycling, but China's decision to ban the importation of many types of recyclable materials has had a major impact across the state. With China out of the picture the price for many recyclables has plummeted, which ultimately will mean that more recyclables are placed in the landfill or consumers will foot more of the bill to recycle. (Eager Law)

Americans spent $230 million on doughnuts last year.  According to Square, Inc., nearly 100 million were sold in the U.S. in 2017. Americans spent 37% more on doughnuts last year over the previous year.

US companies are set to pour $2.5 trillion into buybacks, dividends and M&A this year according to UBS.
The moves should help boost a stock market that has been stuck in neutral for much of the year. May set a record for share repurchases. UBS expects dividend issuance to top $500 billion, buybacks to range from $700 billion to $800 billion, and M&A to constitute about $1.3 trillion.

McDonald's will upgrade 1,000 stores with kiosk and mobile order technology every quarter for the next eight to nine quarters. They are exploring delivery in the U.S. (CNBC)

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



wage rates will increase 25 to 50 cents an hour. It will cost the company about $110 million to $120 million a year before taxes. 90 percent of Costco's employees are paid hourly, and earn $22.50 an hour, on average, with access to health insurance benefits for which the company pays 90 percent of annual costs. (AP)
Costco reported quarterly results posting $32.36 billion in sales and membership revenue in the period a 12.1 percent increase.  Profits jumped 7 percent to $750 million. (Yahoo)

De Beers will open a $94 million lab-grown diamond plant in Gresham. Lightbox Jewelry, will sell the Oregon-grown diamonds for between $200 and $800. The full $94 million investment will be made over the next four years. (PBJ)

Apple has hired about 12 people in a hardware engineering lab in Washington County. (Oregon Live)

Bayer, the German drugmaker will retire Monsanto's name as it finishes the $63 billion takeover of the U.S. seeds maker. (CNBC)

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



It's jobs report Friday: the next snapshot of the U.S. economy is likely to show another 189,000 jobs added in May, with the unemployment rate holding steady at 3.9% and average earnings expected to have risen 2.7% on an annualized basis. The nonfarm payrolls report will also cement expectations that the Fed will raise interest rates again in June, but chances for a fourth rate hike this year have dimmed to 27%, according to CME Group, down from around 50% last week. (SA)

Besides retaliatory tariffs from the European Union, the U.S. is facing "counter-balancing measures" from its northern and southern neighbors after imposing duties on steel and aluminum. Canada's levies will cover C$16.6B in imports, including whiskey, orange juice and other food products, alongside metal tariffs. Mexico's reciprocal measures will also target steel, as well as pork legs, apples, grapes and cheeses. (SA)

A round trip over in Italy - marking a dramatic recovery from a rout on Tuesday ignited by the specter of fresh elections and months of uncertainty.  The ugly drop has now almost entirely reversed.  The week's economic turmoil was driven by fractious politics, which appeared to be drawing to a close on Friday morning after a new Italian coalition government was agreed, although the new government still faces a confidence vote in parliament. (FT)



U.S. stocks rose sharply yesterday, rebounding from the previous day’s rout, as energy shares bounced back amid a rally for oil prices and worries over Italy’s political crisis faded.

The U.S. added 178,000 private-sector jobs in May,  ADP said Wednesday. April’s figure, meanwhile, was revised downward by 41,000 to 163,000, and March’s level was downwardly revised as well.  Hiring was spread across industries and company size. Medium-sized businesses — those with 50 to 499 employees — added 84,000 jobs, while large businesses added 56,000 positions and small ones added 38,000 employees.

The U.S. grew economy grew a touch softer in the first quarter than originally reported, mainly because of a slower buildup in inventories. Gross domestic product was trimmed to an annual 2.2% pace from 2.3%.

The Federal Reserve’s Beige Book came out and the Fed said the U.S. grew “moderately” from late April to early May in their latest evaluation of the economy, indicating the central bank remains firmly on track to raise interest rates next month. Although companies have responded to chronic shortages of skilled workers by boosting pay and overall compensation, the Fed found that “wage increases remained modest” in most of the country.



Political turmoil is pushing Italian yields higher, but not signaling broader crisis. Italian yields have spiked in recent days, with the 2-year yield moving from 0.46% on Friday May 25, to 2.2% currently; this after it was actually negative (-0.08%) two weeks ago. It is important to note however, that yields in Germany and France actually moved lower on this news. The fact that markets are using core European countries as a safe haven may indicate that they believe the issue is in Italy itself, and investors aren't concerned about the potential for broader contagion in the Eurozone at this point. (LPL)

The Bloomberg Barclays Municipal Bond Index has outperformed the broader Bloomberg Barclays Aggregate Index year to date (-0.9% vs -2.2%) and since the beginning of 2017 (4.5% vs 1.2%). (LPL)

Microsoft is up 40% over the last 12 months and is now worth $749 billion and is the world's third most valuable company behind Apple and Amazon. (CNBC)

Dick's Sporting Goods beat forecasts by 7 cents a share, with adjusted quarterly profit of 52 cents per share. Revenue also came in above forecasts. Comparable-store sales fell more than expected, but Dick's also raised its full-year outlook largely above Street's forecast. (AP)

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



Stocks are sharply lower with much of the unrest coming out of Europe amid uncertainty over Italy's political direction. The euro is at 6-1/2 month lows. (CNBC)

Durable-goods orders fell 1.7% April, mostly from a decline in contracts for planes. Orders minus transportation rose 0.9%. (AP)

Oil below $70/barrel on supply concerns. U.S. benchmark crude prices was down nearly 3% last Friday as traders digested reports that OPEC, Russia, and others are in discussions to potentially increase production by up to 1 million barrels/day. The news comes on the heels of an announcement from the International Energy Agency last week that the supply glut is gone and the run-up in oil prices is starting to impact consumer demand. (LPL)

According to Reuters, Qualcomm will meet with Chinese regulators in Beijing this week, as it seeks to get final clearance for its $44 billion deal to acquire NXP Semiconductors. (CNBC)

Coca-Cola is selling its first alcoholic product called Lemon-Do to consumers of Japan. The lemon-flavored drink will be available with 3%, 5% and 7% alcohol. (Fortune)

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



More trade ups and downs. President Trump ordered an investigation into whether auto and truck imports weaken the U.S. economy and threaten national security, which sparked a response from a Chinese official suggesting the move represented an abuse of trade rules. Though likely another part of the administration's negotiation strategy, it may lead to new tariffs on foreign cars. (LPL)

 

The U.S. economy is still chugging along. The Markit Purchasing Managers' Index showed both the U.S. services and manufacturing sectors continued to expand last month. Manufacturing activity registered its highest reading since September 2014, with manufacturers intending to boost production in the near term. Backlogs of work on the services side hit levels not seen since March 2015, though new business ticked modestly lower. Input costs in both sectors rose at the fastest pace in almost five years as inflationary pressures continue to mount, but overall the data remain solidly in expansionary territory year. (LPL)

 

Ross Stores beat estimates by 3 cents with quarterly profit of $1.10 per share, with the discount retailer's revenue in line with forecasts. (CNBC)

 

Join us this weekend for Financial Focus Radio.

S&P 500 is down 6 and the NASDAQ is down 1. The MSCI international index is lower.

Oil is down $1.61 at $69.10 a barrel.

Gold is down $1 at $1304 a Troy ounce.

 

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

 

 



Is Turkey a canary in the coal mine? Turkey's currency, the lira, has lost over 20% versus the dollar since the start of the year and dropped as much as 5% overnight on Tuesday, as market participants' worries about the state of Turkey's economy rose. (LPL)

 

Uber announced its first-quarter financials, reporting strong sales growth. Uber plans to sell between $400 million and $600 million in stock at $40 per share to investors. (CNBC)

 

Best Buy's same store sales rose 7.1% in the first quarter.

Domestic online comparable sales growth was 12% in the U.S.. Best Buy has about 15% of the U.S. consumer electronics market. (Reuters)

 

Hormel Foods, makers of Spam canned ham, Dinty Moore stew and other foods, reported quarterly earnings of $237.4 million. Revenue was $2.33 billion in the period. Hormel shares have dropped almost 2% since the beginning of the year. (AP)

 

Procter & Gamble says it will continue investing in Russian plants in the coming years, despite increasing risks due to deteriorating U.S.-Russian relations. (AP)

 

S&P 500 is down 6 and the NASDAQ is down 7. The MSCI international index is lower.

Oil is down 91 cents at $71.00 a barrel.

Gold is up $7 at $1296 a Troy ounce.



The 10-year Treasury yield again broached the 3% level last week, and unlike previous instances, it managed to stay above that level for the entire week, indicating Treasuries may have moved into a new range. (LPL)

The Russell 2000 closed at yet another new all-time high this week. For the year, there have been 14 new highs for the Russell 2000 and 14 for the S&P 500 Index. The Russell 2000 is up 6.6% for the year, versus a 2.2% gain for the S&P 500. Sparking the strength in small caps has been a better economy, tax reform, fear over trade tariffs, and a stronger U.S. dollar. (LPL)

Marvin Ellison, J.C. Penney chairman and CEO is leaving the retailer to become CEO at Lowe's. Prior to J.C. Penney, Ellison worked more than 12 years at Home Depot. (CNBC)

Is the next U.S. recession just around the corner? In a survey of 100 economists and real estate experts sponsored by Zillow nearly half expect the next recession to begin sometime in 2020. (AP)

Red Robin Gourmet Burgers earned 69 cents per share last quarter. Revenue was also short of estimates. Same store sales dropped 0.9%. (CNBC)

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



Yesterday the S&P 500 gained 0.7% closing at 2,733 as industrials jumped 1.5%. The Nasdaq climbed 0.5% to 7,394.

Over the last week, forward-four-quarter estimates for the S&P 500 Index rose 0.6%. With 464 S&P companies having reported, first quarter S&P 500 earnings are tracking to a 26.2% year-over-year increase, while 79% of companies have exceeded earnings targets. (LPL)

The U.S. dollar has come back strongly over the past several months. After losing nearly 10% in 2017 and an additional 4% in January, the U.S. Dollar Index has rallied more than 5% off its February lows. Gains have been driven by several factors, particularly rising U.S. interest rates, partially due to increasing Federal Reserve (Fed) rate hike expectations, and repatriation of overseas profits as prescribed by the new U.S. tax law. (LPL)

Hasbro, the maker of the iconic Play-Doh has successfully trademarked that musky, sweet vanilla scent of childhood.
Few tweaks have been made to Play-Doh's recipe since its inception in 1956, and its scent has always been one of its main differentiation from other clay competitors.(CNBC)

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



Wells Fargo employees improperly altered customer documents trying to comply with a regulatory consent order over anti-money laundering controls. (Wall Street Journal)

A slow walk to the gallows? J.C. Penney reported first quarter results. Revenue fell about 4.3% to $2.58 billion. Same-store sales rose 0.2% but were short of analysts' forecast of 2% growth. Penney's lost $78 million, or 25 cents per share. (Reuters)

The Conference Board's Leading Economic Index gained 0.4% to 109.4 in April and has climbed for the last six months. The index measures 10 key metrics of economic movement and projects US economic conditions for the next 6 to 12 months.

General Electric has made a deal to merge its transportation business with rail industry equipment maker Wabtec (Reuters).

Microsoft has bought Semantic Machines, an artificial intelligence start-up. The company did not disclose any financial details of the acquisition. (CNBC)

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



New applications for unemployment benefits were reported at 222,000 this week. Claims remain near 40-year lows. (LPL)

Japan's streak of positive GDP growth quarters comes to an end. After eight straight quarters of growth, the longest streak in nearly 30 years, Japan's gross domestic product contracted in the first quarter. (LPL)

According to the Centers for Disease Control US births hit lowest number since 1987: American women are having children at the lowest rate on record, with the number of babies born in the U.S. last year dropping to a 30-year low. 3.85 million babies were born last year, down 2% from 2016.

Argentina's currency stabilized as their central bank declined to support the peso, which has plunged about 16% this month. Argentina is seeking a loan from the IMF and is the Greece of Latin America. (Reuters)

Nordstrom had quarterly profits of 51 cents per share beating estimates by 8 cents. They also beat on sales. But same store sales growth was disappointing. The stock was sinking in early trading. (CNBC)

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


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