Weekly Economic Update 3/1/2010

Written by Ryan Sheppard | 08 March 2010

Quote of the week: “A person will be just about as happy as they make up their minds to be.” – Abraham Lincoln

9.7% and holding. The Labor Department reported only 36,000 net job losses last month, so the jobless rate was flat for February.  Economists had widely assumed the unemployment rate would inch upward due to winter weather affecting construction and retail industries.¹

Major boost in factory orders. They rose 1.7% in January, according to Commerce Department data.  This is the best number in four months and follows a 1.5% advance for December.²

Pending home sales sink. What does the 7.6% fall for January indicate?  It would seem to signal that the extended tax credits have become less magnetic to buyers.  Let’s hope sales hold up this spring as the Fed ceases its purchases of mortgage-linked securities.³

Gold, copper, oil go higher. Copper prices rose 4.10% last week to $0.134/lb.  Gold gained $16.50 last week (1.48%) to settle at $1,134.80 an ounce Friday.  Crude futures rose $1.84 last week (2.31%) to $81.50 per barrel on the NYMEX at Friday’s close.⁴

March of the bulls? Wall Street was buoyed by the unchanged jobless rate on Friday, and the Dow climbed 122.06 to cap off its 2.33% weekly gain.  The S&P 500 did even better: a 3.10% rise on the week to 1,138.70 at the closing bell on Friday.  The NASDAQ?  It advanced 3.94% on the week to 2,326.56.⁵

Change      Y-T-D     1-Yr Chg     5-Yr Avg     10-Yr Avg
DJIA            +1.32     +60.23        -0.68          +0.19
NASDAQ     +2.52     +79.01        +2.47          -5.26
S&P 500      +2.12     +66.83        -1.37          -1.82

Real Yield    3/5       1 Yr Ago     5 Yrs Ago    10 Yrs Ago
10YrTIPS    1.48%     1.98%        1.65%          4.34%

(Source: CNBC.com, CNNMoney.com, ustreas.gov, bls.gov, 3/5/10)^5,6,7,8
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.  These returns do not include dividends.
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¹ washingtonpost.com/wp-dyn/content/article/2010/03/05/AR2010030500571.html [3/5/10]
² latimesblogs.latimes.com/money_co/2010/03/new-factory-orders-up-17-in-january-largest-increase-since-september.html [3/4/10]
³ businessweek.com/news/2010-03-04/u-s-economy-pending-sales-of-existing-homes-unexpectedly-drop.html [3/4/10]
⁴ blogs.wsj.com/marketbeat/2010/03/05/data-points-energy-metals-236/ [3/5/10]
⁵ cnbc.com/id/35729112 [3/5/10]
⁶ money.cnn.com [3/5/10]
⁷ ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield_historical.shtml [3/5/10]
⁸ treasurydirect.gov/instit/annceresult/press/preanre/2000/ofm11200.pdf [1/12/00]