Wealth Management Economic Update March 28, 2016

U.S. and World News

  • Brussels_Belgium_360Terrorism ripped through the Belgian city of Brussels this week as explosives were placed at the capital’s airport and metro station, killing 31 and wounding 300 more. Terrorist group ISIS claimed responsibility for the Brussels attacks that took place just four months after another major attack in Paris. One suspect believed to have been involved in the attacks has been arrested and is being questioned. The most recent attacks again shine the spotlight on the European migrant crisis and put Europe’s open borders policy into question.
  • This week President Obama became the first sitting U.S. president since Calvin Coolidge in 1928 to visit Cuba in a historic visit. Obama met with Cuban President Raul Castro in a symbolic measure that indicated the end of the Cold War era conflict between the two nations. Despite the opening up of limited trade between the two countries, vast ideological differences remain.

Markets

  • Markets were down marginally in the holiday shortened trading week. The S&P 500 lost 0.65% and closed at 2,036. Likewise, the Dow Jones fell 0.49% and closed at 17,516. So far in 2016, the S&P is up 0.14% and the Dow is up 1.22%.
  • Interest rates were mostly unchanged this week. The 5 year and 10 year U.S. Treasury Notes are now yielding 1.38% and 1.90%, respectively.
  • The spot price of WTI Crude Oil fell 4.08% this week to close at $39.46 per barrel. WTI Crude is down 1.30% in 2016.
  • The spot price of Gold decreased 3.06% this week, closing at $1,217.05 per ounce. Year to date, gold prices are up 14.70%.

Economic Data

  • Initial jobless claims came in at 265,000 which was unchanged from last week’s reading. The Labor Department noted no special factors in the data. The four week moving average for claims moved slightly up to 259,750.
  • Existing home sales declined by -7.1% in February, worse than an expected -3.0% drop. Sales of existing single family (-7.2%) and multi-family (-6.6%) fell during the month.
  • New home sales were in line with expectations, rising 2.0% during February. Despite the increase, the West region was the only one to see gains in new home sales while the Midwest, South and North regions saw declines.

Fact of the Week

  • The average holding period of a stock in the United States has fallen from about 8 years as of 1960, to only 1.3 years today. The average holding period of stocks hit its low of 1.0 years in 2010 (Source: Strategas Research Partners).

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Tamara Wiley, CFP® – (630) 844-3222 twiley@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

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