For the week ending 6-23-17
The major stock indices ended the week with gains, but the NASDAQ had the best showing by advancing 1.8%, boosted primarily by biotech stocks. Healthcare stocks in general, and biotech stocks more specifically, have rallied as the American Health Care Act has made its way through the Senate and is expected to be voted on soon. The Dow and S&P 500 finished with small gains. Amazon’s plans to acquire Whole Foods Market, announced the previous week, continued to reverberate among retail stocks. Shares in Bed Bath & Beyond tumbled Friday, for example, with some observers pointing to worries about competition from Amazon as exacerbating the drag from a disappointing earnings report.
In economic news, new home sales rose 2.9% in May to an annualized rate of 610,000, just ahead of estimates. The report also included a 24,000 upward revision of April’s numbers. The real surprise in the report, however, was the enormous strength in selling prices. The median price of a new home surged 11.5% in the month to $345,800. This price traction is related not only to demand but also to supply of new homes, which is very tight. Existing home sales beat expectations as well, rising 1.1% for the month to an annualized rate of 5.62 million units. These two housing reports are good news as they come after disappointed results earlier this month in new construction and permits. New and existing home sales figures prove that the demand is there, and hopefully this will translate into accelerated construction in the future.
For the week, the Dow Jones rose 11 points to 21,395 (0.1%); the NASDAQ was up 113 points to 6,265 (1.8%); and the S&P 500 added 5 points to 2,438 (0.2%)
Oil was unchanged at $43/bbl. Gold fell $3 to 1,258
The yield on the 10 yr. treasury was unchanged at 2.14%
Disclaimer: It is worth noting that the opinions in this commentary are Christian Peterson’s and may occasionally vary somewhat from the opinions of the Winch Financial investment team as a whole. Client recognizes that any opinions or analysis described in this commentary involve the Advisor’s judgment and good faith and do not constitute investment advice. All recommendations or observations are subject to various market, currency, economic, political and business risks. Client recognizes that no party to this alert has made any guarantee, either oral or written, that Client’s investment objectives will be achieved. Advisor shall not be liable for any action performed or omitted to be performed or for any errors of judgment or mistake, except in the case of Advisor’s gross negligence, willful misconduct, or violation of applicable law. Advisor shall not be responsible for any loss incurred by reason of any act or omission of Client, custodians, broker-dealers, or any other third party. Nothing in this commentary shall constitute a waiver or limitation of any rights that Client may have under applicable state or federal law, including without limitation the state and federal securities laws.