At Fridays close, we had two new record highs with the Dow Junes Industrial Average (DJIA) standing at 35,208 and the S&P 500 at the top of the podium at 4436. On Monday we started the week with a sell off at midday and then again in the last hour of trading due to economic growth inflation worries overshadowing strong earnings. However, Mondays losses didn't last long as the S&P 500 recorded new highs on Tuesday, Thursday, and Friday. At midweek, the 10 year Treasury yields dropped close to record 1.1% lows, but then bounced back up to 1.3% on Friday buoying bank stocks. Fridays continued bullishness was driven by better-than-expected employment numbers with 943,000 new jobs created in July and the unemployment rate dropping to 5.4%. As we come to the close of earnings season, 87% of reporting companies beat expectations giving us the best earnings quarter since 2008. From a technical perspective, Large Cap (DJIA/S&P 500) continues to lead the way, and as such, well Let that trend continue to be our friend. And looking forward to next week, well see more inflation related numbers on Wednesday. For TSP TIPS, the C fund mirrored the S&P 500 and also hit new highs three times this week. Last week, we mentioned that both the S and I funds were stuck in sideways channels. This week, weve seen some improvement as both have given buy signals with their prices now above their short-term Moving Averages (MA), with those MAs now trending upward. With the S and I funds within 1.4% of their June highs, we could see a breakout to the upside and therefore recommend the following reallocation.
At Fridays close, we had two new record highs with the Dow Junes Industrial Average (DJIA) standing at 35,208 and the S&P 500 at the top of the podium at 4436. On Monday we started the week with a sell off at midday and then again in the last hour of trading due to economic growth inflation worries overshadowing strong earnings. However, Mondays losses didn't last long as the S&P 500 recorded new highs on Tuesday, Thursday, and Friday. At midweek, the 10 year Treasury yields dropped close to record 1.1% lows, but then bounced back up to 1.3% on Friday buoying bank stocks. Fridays continued bullishness was driven by better-than-expected employment numbers with 943,000 new jobs created in July and the unemployment rate dropping to 5.4%. As we come to the close of earnings season, 87% of reporting companies beat expectations giving us the best earnings quarter since 2008. From a technical perspective, Large Cap (DJIA/S&P 500) continues to lead the way, and as such, well Let that trend continue to be our friend. And looking forward to next week, well see more inflation related numbers on Wednesday. For TSP TIPS, the C fund mirrored the S&P 500 and also hit new highs three times this week. Last week, we mentioned that both the S and I funds were stuck in sideways channels. This week, weve seen some improvement as both have given buy signals with their prices now above their short-term Moving Averages (MA), with those MAs now trending upward. With the S and I funds within 1.4% of their June highs, we could see a breakout to the upside and therefore recommend the following reallocation.