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Here is a sample* of the weekly newsletter released by Wayne Messmer and Associates. This merely illustrates the type of financial information you can expect to find every week. However, that’s not all you’ll find within our newsletter as we include various recipes and green living tips every week as well. If you want to get the most from our newsletter, feel free to sign up to get the newsletter e-mailed to you every week.
*Please note that the on-site sample below is not updated with the latest financial newsletters provided by our Chicago financial services firm.
Global equities rose for their third week in a row to new all-time highs for many indexes, with the Dow closing above 15,000 for the first time ever, as quantitative easing policies around the world continued to drive a liquidity bubble in stocks and other assets. The Dow has now gone 87 days without a three-day losing streak - its best run by that metric since 1958. Up to this point, positive market momentum has been able to fend off the traditional maxim "sell in May and go away," which has led to muted returns in the May to November period for the last several decades. This was also aided in part by relatively benign news flow both in the U.S. and overseas. For the week, small caps beat large caps, value and growth stocks traded in-line, and cyclicals continued their recovery, with industrials and consumer discretionary being the strongest sectors, while utilities and consumer staples were the worst.
Economic news flow was fairly limited for the week. In the U.S., initial claims dropped to 323,000, bringing the four-week average down to 337,000, and the JOLTS survey of job openings increased to 3.84 million, versus expectations for 3.77 million. Although this was a fairly strong showing, we would note that after adjusting for losses in the employment participation rate, which continues to fall rapidly, unemployment remains near the level it was at in the depths of the financial crisis in 2009. Quit and hire rate data is also weak, implying that confidence in the labor market is poor. We'll be looking for an improvement in related labor "churn," as well as improvement in the participation rate and the percentage of the population employed before feeling confident in a labor market recovery.
Overseas, the yen broke 100 for the first time in four years on Thursday, as its extreme QE policies are gaining traction. In China, reassuring trade data, which was both unexpected and questioned by some, drove a rally in materials.
Like many, we have been surprised by the strength of the market rally this year. Hedge fund managers have been largely critical of the Fed and other central banks, in part because their year-to-date returns have averaged only 4.4%, with traditional investment maxims and methodologies being rendered less effective by unprecedented global quantitative easing. Meanwhile, retail investors continue pouring into the market, with last week's $1.8 billion marking the 18th week in a row of positive mutual fund inflows. "Don't fight the Fed" seems to be the predominant viewpoint on the street for now, but with a seemingly invulnerable market breaking to new highs every day, it is worth keeping in mind that we are approaching the seasonally weakest part of the year. Although full-year 2013 returns may be very strong, it is likely that we will hit a patch of volatility and weakness during the next several months.