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Weekly Market Update – March 6, 2014

Good news was bad news for the market Friday as a better-than-expected February jobs report stoked fears that an interest rate hike could come sooner than expected.  The Dow fell 280 points.  For the week the Dow was down 1.5% and for the year it is now flat.

The February employment report showed a gain of 295,000 jobs (above estimates of 240,000).  The unemployment rate fell to 5.5% from 5.7%.  The strong jobs report increases the likelihood of a rate increase, perhaps as early as June. 

Oil fell 1.9% Friday to close at $49.78, up .5% for the week.  Natural gas closed slightly higher on the day.  The yield on the 10-year Treasury rose 13 bps Friday to 2.24%, up 24 bps for the week and now up 7 bps for the year. Through Thursday, March 5, our trust preferred portfolios were up over 4.5%, on average, versus .74% for the Barclays Aggregate Bond Index. 

Next week, weekly jobless claims and February retail sales on Thursday and inflation data and a consumer confidence reading on Friday highlight the economic calendar.  Expect weekly jobless claims to settle in the 310,000 – 320,000 range (from 320,000 this week), retail sales to show improvement from January, inflation to rise slightly and consumer confidence to decline from January.

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Ulland Investment Advisors

4550 IDS Center · Eighty South Eighth Street · Minneapolis MN 55402 · Telephone: 612-312-1400 · Facsimile: 612-204-3464