The Markets (as of market close October 27, 2017)

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week’s Economic Headlines

• The first estimate of the third-quarter gross domestic product showed economic growth at an annual rate of 3.0%. The second quarter grew at an annual rate of 3.1%. Each succeeding estimate (three in all) is based on more complete data. The increase in the GDP in the third quarter reflected positive contributions from personal consumption expenditures (consumer spending), private inventory investment, nonresidential (business) fixed investment, exports, and federal government spending. These increases were partly offset by decreases in residential fixed investment and state and local government spending. Imports, which are a subtraction in the calculation of GDP, decreased.

• Good news on the manufacturing front as new orders for long-lasting goods (durable goods) gained $5.1 billion, or 2.2%, in September. This increase follows a 2.0% rise in August. Also increasing in September were shipments (1.0%), unfilled orders (0.2%), and inventories (0.6%). More importantly, new orders for durable goods are up 5.2% over the last 12 months.

• The number of sales and average selling prices of new homes soared in September following a poor August. Sales of new single-family houses were at an annual rate of 667,000, 18.9% above the revised August rate of 561,000 and 17.0% ahead of the September 2016 estimate. The median sales price of new houses sold in September 2017 was $319,700 ($303,800 in August). The average sales price was $385,200 ($364,300 in August). The estimate of new houses for sale at the end of September was 279,000, which represents a supply of 5.0 months at the current sales rate.

• The trade in goods deficit was $64.1 billion in September, up $0.8 billion from August. Exports of goods were $129.6 billion, $0.9 billion more than August exports. Imports of goods for September were $193.7 billion, $1.7 billion more than August imports.

• In the week ended October 21, the advance figure for initial claims for unemployment insurance was 233,000, an increase of 10,000 from the previous week’s level, which was revised up by 1,000. The advance insured unemployment rate remained 1.3%. The advance number of those receiving unemployment insurance benefits during the week ended October 14 was 1,893,000, a decrease of 3,000 from the previous week’s level, which was revised up 8,000.

Eye on the Week Ahead

The Federal Open Market Committee is expected to raise interest rates this week as inflation and economic growth seem to be moving upward. The jobs report for October is out at week’s end. September saw the number of new jobs decrease for the first time in several months. That trend is expected to be short-lived.

Data sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.

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