Weekly Economic Update

July 8, 2013



Payroll growth in June matched that of May, according to the Labor Department (the May gain was revised upward). The private sector hired 202,000 new workers after adding 207,000 in May, offsetting reductions to government payrolls. Economists polled by Bloomberg had forecast net job growth of 165,000, so this was encouraging. Will it encourage the Federal Reserve to taper? The Fed’s next policy announcement occurs on July 31, but it will not revise its economic forecasts at that time and no press conference is scheduled afterward. Some economists think the Fed could start tapering QE3 as soon as September.1


The June purchasing manager indices from the Institute for Supply Management both showed sector expansion. The pace of growth moderated in the service sector, with June’s reading of 52.2 down 1.5 points from May. ISM’s manufacturing index rebounded impressively from a 49.0 reading in May to 50.9 in June.2


The Obama administration is postponing one of the key reforms of the Affordable Care Act – businesses with 50 or more full-time employees now won’t have to provide health insurance to workers until 2015. As around 85% of Americans already have health care coverage, the decision doesn’t impact a majority of individuals or businesses. Most uninsured individuals will still need to buy health coverage in 2014 and businesses with fewer than 50 FTEs won’t be required to sponsor health insurance plans next year. Still, the delay raises new questions about whether national health care reforms can proceed on schedule.3,4


Stocks started July well. The S&P 500 rose 1.59% in four days to settle at 1,631.89 Friday. The DJIA rose 1.52% to close at 15,135.84 at week’s end, and the NASDAQ advanced 2.24% to wrap up the week at 3,479.38. Oil settled at $103.22 Friday, with prices soaring 6.7% in a week on worries about political instability in Egypt.5,6

THIS WEEK: The Q2 earnings season begins Monday with results from Alcoa.  Nothing major is scheduled for Tuesday. Wednesday, the June 19 FOMC minutes are released along with data on May wholesale inventories; Yum! Brands and Family Dollar report earnings. Thursday brings the latest initial jobless claims report plus earnings from Progressive and TXI. Friday, JPMorgan Chase and Wells Fargo report quarterly results, June’s Producer Price Index arrives, and the University of Michigan publishes its initial July consumer sentiment survey.

















S&P 500






7/5 RATE









Sources: usatoday.com, bigcharts.com, treasury.gov – 7/5/137,8,9,10

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.

These returns do not include dividends.

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results.  Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.


1 – bloomberg.com/news/2013-07-05/payrolls-in-u-s-increased-195-000-in-june-unemployment-7-6-.html [7/5/13]

2 – briefing.com/investor/calendars/economic/2013/07/01-05 [7/5/13]

3 – nytimes.com/2013/07/03/us/politics/obama-administration-to-delay-health-law-requirement-until-2015.html [7/3/13]

4 – kansascity.com/2013/07/03/4328512/qa-on-impact-of-health-law-delay.html [7/3/13]

5 – markets.on.nytimes.com/research/markets/overview/overview.asp [7/5/13]

6 – reuters.com/article/2013/07/05/us-markets-oil-idUSBRE9640FE20130705 [7/5/13]

7 – usatoday.com/money/markets/overview/ [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F5%2F12&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F5%2F12&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F5%2F12&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F3%2F08&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F3%2F08&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F3%2F08&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=7%2F3%2F03&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=7%2F3%2F03&x=0&y=0 [7/5/13]

8 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=7%2F3%2F03&x=0&y=0 [7/5/13]

9 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [7/5/13]

10 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [7/5/13]

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