FOURTH QUARTER SAW 2.6% GROWTH
Given the final 5.0% GDP reading for Q3, this initial Commerce Department estimate displeased many investors – even though the personal spending rate rose an impressive 4.3% in Q4. Investors also disliked the 3.4% overall dip in hard goods orders for December, which followed a 2.1% descent in November.
HOUSEHOLDS IN AN UPBEAT MOOD
At 102.9, January’s Conference Board consumer confidence index shattered the 96.9 forecast of analysts polled by MarketWatch. The University of Michigan’s January consumer sentiment index reached 98.1, its best final monthly reading in 11 years.
NEW HOME SALES ACCELERATE
They advanced 11.6% in December, with the Census Bureau noting an 8.8% yearly rise in the sales pace. On the other hand, the National Association of Realtors found pending home sales down 3.7% in December. November’s S&P/Case-Shiller home price index showed an overall 4.3% yearly gain, 0.2% less than the October edition.
A ROUGH MONTH ENDS ON WALL STREET
While the January 28 Federal Reserve policy statement bullishly referenced an economy growing at “a solid pace,” disappointment over key earnings reports and the Q4 GDP number sent stocks further south. Losing another 2.77% across five trading days, the S&P 500 concluded January at 1,994.99. The Dow and Nasdaq also gave up ground last week – the Dow lost 2.87% to close at 17,164.95 Friday, while the Nasdaq retreated 2.58% in five days to slip to 4,635.24.