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December 8, 2024
JOBS BOUNCE BACK: According to the U.S. Bureau of Economic Analysis, the U.S. economy added 227,000 new jobs in November. Hurricane-displaced workers returned to their jobs, and the Boeing strike ended. The unemployment rate rose slightly to 4.2%. The reports for September and October were revised upward showing 56,000 more jobs than first reported. Overall the report reassured investors that the labor market is showing some resilience.
RECORD HIGHS AGAIN: The S&P 500 hit a fresh new record after a rally sparked by November's jobs report. The jobs report showed a rebound which alleviated fears of a downturn, but not so much that investors worried about the Fed being deterred from lowering its key interest rate later this month. Tech stocks led the way as Tesla rose 5% and Amazon 2.7% on Friday. Salesforce was up 11% for the week after a rosy earnings report. Small companies struggled as the Russell 2000 fell by over 1%.
LONGER-TERM PERFORMANCE: Below are the annualized three-year and five-year numbers for these same indices.
NEXT WEEK'S INFLATION DATA AND THE FED: U.S. inflation data will be announced on Wednesday, and Producer Price data will come on Thursday. If the data comes in too hot, it may rattle the markets as the Fed's potential decision to lower interest rates at its December 18 meeting could be taken off the table.
MEANWHILE IN CANADA AND EUROPE: It is widely believed that the Bank of Canada will cut interest rates this Wednesday (how much is in question). The European Central Bank will hold its last meeting of the year later this week, and a rate cut is also expected.
RENTS DECREASE: In November, rents decreased by 0.8%, and were 0.6% lower than one year ago. Generally, rents decrease this time of year, and so we are likely to see at least one more month of decreasing rents. November was the fifteenth consecutive month of declines in rents. The vacancy rate increased to 6.8%, the highest since 2019.
OLDER CARS: I just recently replaced my car. It was 14 years old, and I replaced it reluctantly. I am not alone. Thirty years ago, the average age of a passenger car in the U.S. was 8.4 years. Now it is 13.6 years. The good news is that cars are better made.
OLDER HOME BUYERS: The median age of a first-time homebuyer in the U.S. is now 38, three years older than a year ago. That is a record high. In the 1980s, the average first-time homebuyer was in their late 20s.
HEAVY TRUCK SALES: Sales of heavy trucks in November was 4% higher than one year ago. Usually, such sales decrease prior to a recession, so this is positive news.
PEARL HARBOR: It is difficult to imagine what the Christmas season was like in 1941. Christmas still came, and so did war. There is an annual observance at Pearl Harbor, and this year only two serviceman who lived through the attack were able to make it. One was Ike Schab, age 104. He was asked to come and salute on behalf of all the survivors, and he gladly accepted. He spent six weeks in physical therapy to build enough strength to be able to stand on his own and give the salute. "I was honored to do it. I'm glad I was capable of standing up. I'm getting old, you know." God bless you Ike!
'TIS THE SEASON: So we had a few people over to the house this weekend, and I decided to get festive.
Have a great week!
Our purpose is to honor God by helping our clients see the objective, find the path, and navigate past the obstacles to a more prosperous future.
Douglas R. MacGray, J.D., C.F.P. ®
President
Stonecrop Wealth Advisors, LLC
Direct | Cell | Fax
(610) 628 4545
"My father volunteered in early 1941, before Pearl Harbor, and became an officer in the U.S. Navy. As I was growing up, he taught me the responsibility of command. A leader is ultimately responsible for every aspect of the welfare of people under his or her care. That was a deeply felt obligation in his generation." Chesley Sullenberger.
"Dear friends, do not be surprised at the painful trial you are suffering, as though something strange were happening to you." I Peter 4:12 (NIV)
SOURCES:
RECORD HIGHS AGAIN: https://www.wsj.com/livecoverage/jobs-report-stock-market-today-dow-nasdaq-sp500-12-06-2024 AND https://www.marketwatch.com/livecoverage/stock-market-today-dow-futures-dip-ahead-of-november-jobs-report
JOBS BOUNCE BACK: https://www.bls.gov/news.release/empsit.nr0.htm
PEARL HARBOR: https://abcnews.go.com/US/wireStory/100-year-pearl-harbor-survivor-recalls-confusion-chaos-116550478
NEXT WEEK'S INFLATION DATA AND THE FED: https://www.wsj.com/economy/central-banking/week-ahead-for-fx-bonds-u-s-inflation-data-rate-decisions-in-eurozone-and-australia-in-focus-3e5fe6c5?mod=economy_lead_pos5
MEANWHILE IN CANADA AND EUROPE: https://www.wsj.com/economy/central-banking/week-ahead-for-fx-bonds-u-s-inflation-data-rate-decisions-in-eurozone-and-australia-in-focus-3e5fe6c5?mod=economy_lead_pos5
HEAVY TRUCK SALES: https://www.calculatedriskblog.com/2024/12/heavy-truck-sales-increased-in-4-yoy-in.html
(c) 2024 A.D., Stonecrop Wealth Advisors, LLC, All Rights Reserved
Investment advisory services offered through Stonecrop Wealth Advisors, LLC, a Registered Investment Advisor with the U.S. Securities and Exchange Commission.
SDG
*S&P 500: This is a measure of the performance of the 500 largest companies in the United States, and it a common index to track the performance of U.S. equity markets, especially the large cap markets.
*MSCI All Country World Index X US: This is a broad measure of the performance of worldwide equity markets excluding the United States.
*Bloomberg U.S. Aggregate: This is a measure of the U.S. bond markets.