Friday, September 13, 2013

Economic Journal - Friday, 9/13/2013

(As of 7:14 am PST)
Stocks wobbled at the start but have picked up momentum as investors analyze economic data reports in lieu of next week’s Fed meeting.  The Commerce Dept. reported US retail sales climbed just 0.2% in August, the smallest increase since April and well below consensus estimates.  On a positive note, retail sales for June and July were revised upward.  US wholesale prices rose in August as gasoline and food costs moved higher.  Core wholesale prices (which removes the volatile food and energy categories) was unchanged indicating low inflationary pressure.  Lastly, the University of Michigan consumer sentiment report showed the preliminary reading for September falling unexpectedly to 76.8, below initial estimates.  With a military strike on Syria avoided, investors have turned back to the issue of bond tapering and how and when the Fed will execute its strategy to wean the economy off its' stimulus programs that have been in place since the financial crisis.  Next week’s FOMC meeting will be under the microscope with markets looking for direction for the final quarter of the year.  International markets are mostly lower today as are commodities.  Interest rates ticked down and the US dollar is slightly higher.  The first two weeks of September have been surprisingly strong for equities, but expect volatility to return in the second half of the month as the taper gets underway.

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