U.S. and World News
- After trade discussions broke down three weeks ago, the Trump administration has invited Chinese officials for another round of negotiations. President Trump wrote in a tweet on Thursday that “We are under no pressure to make a deal with China, they are under pressure to make a deal with us”. Meanwhile, an editorial in the China Daily read “The Trump administration should not be mistaken that China will surrender to the U.S demands.” This new round of trade negotiations comes before additional tariffs of 10-25% on $200 billion of Chinese imports are being prepared by the United States. China is expected to retaliate in a similar fashion to these tariffs.
- Hurricane Florence, a Category 1 hurricane, made landfall this morning on the North Carolina coast bringing sustained winds of 90 miles per hour and a life-threatening storm surge. The slow moving storm is expected hang over the Carolinas this weekend and drop catastrophic amounts of rain causing a lot of flooding. The power was knocked out in nearly 500,000 homes and hundreds were rescued this morning as the storm made landfall.
- Stocks rebounded this week. The S&P 500 rose 1.21% and closed at 2,905. The Dow Jones rose by 0.94% and closed at 26,155. Year to date, the S&P is up 10.09% and the Dow Jones is up 7.50%.
- Yields rose higher again this week. The 5 year and 10 year U.S. Treasury Notes are yielding 2.90% and 3.00%, respectively.
- The spot price of WTI Crude Oil increased by 1.83% this week to close at $68.99 per barrel. Year to date, Oil prices are up 14.77%.
- The spot price of Gold dropped 0.33% this week, and closed at $1,192.99 per ounce. Year to date, Gold prices are down 8.43%.
- Initial jobless claims fell by 1,000 to 204,000 this week. The four-week moving average of claims moved down by 2,000 to 208,000. Claims rose by 5,000 in California and 2,000 in Michigan. This is the lowest level of jobless claims since 1969.
- The consumer price index (CPI) rose 0.22% in August versus expectations for a 0.3% increase.
- Core CPI ex-food and energy rose 0.08% in August versus expectations of a 0.2% increase. The soft reading was led by the apparel category. The year-over-year rate declined to 2.2%.
- Wholesale inventories rose 0.6% in July versus expectations for a 0.7% increase.
- The producer price index (PPI) declined by 0.1% versus expectations for a 0.2% increase.
- Core PPI ex-food and energy rose 0.1% versus an increase of 0.2% expected.
- Retail sales rose by 0.1% in August versus expectations for a 0.4% increase. The weaker sales growth was a result of lower auto sales.
- Core retail sales rose 0.1% in August versus an increase of 0.4% expected.
- Import prices fell 0.6% in August versus expectations for a 0.2% decline
- Industrial production rose by 0.4% in August versus expectations of a 0.3% increase.
- The University of Michigan’s index of consumer sentiment September preliminary reading came in at 100.8 versus expectations of 96.6.
Fact of the Week
- In a “private letter ruling” issued on August 20th, the IRS approved the use of a program to help aid employees that have student debt. The program would allow employees that make student loan payments to still receive an employer contribution in their 401(k) as if the loan payment was a pre-tax 401(k) contribution. (Source: IRS)
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