As of the Week of November 12, 2018
In this week’s recap: swift service sector expansion, sustained consumer optimism, a surge in wholesale inflation, and gains for equities.
SERVICE SECTOR KEEPS BOOMING
At a lofty October mark of 60.3, the Institute for Supply Management’s non-manufacturing purchasing manager index was a bit lower than the record 61.6 reading seen in September, but it also beat the 59.3 consensus forecast from Refinitiv. Across the 12 months ending in October, the mean reading for the index was a strong 58.5.1,2
IS THIS THE BEST YEAR FOR CONSUMER SENTIMENT SINCE 2000?
It could turn out that way, if the University of Michigan’s influential index maintains its current level. Its preliminary November edition came in at 98.3, slightly below the final October mark of 98.6 and slightly above the 98.0 reading projected in a Bloomberg analyst poll. The gauge has averaged a reading of 98.4 in 2018, a level unseen in the past 18 years.3
WHOLESALE INFLATION JUMPS 0.6% IN A MONTH
Higher costs for fuel and industrial supplies were significant factors, according to the Bureau of Labor Statistics. The PPI rose 2.9% across the 12 months ending in October.4
A NEW MONTH, A NEW DIRECTION FOR STOCKS
In November, the market is doing its best to erase the memory of October. All three major indices advanced again last week, with the Dow Industrials adding 2.84%; the S&P 500, 2.13%; the Nasdaq Composite, 0.68%. At Friday’s close, their settlements were: Dow, 25,989.30; S&P, 2,781.01; Nasdaq, 7,406.90.5
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