Much of the week’s news was centered on BP and President Barack Obama. BP is establishing a $20 billion claims fund as part of their obligations as a responsible party arising from the Deepwater Horizon spill. Over the next three and a half years, they will pay legitimate claims including natural resource damages and state and local response costs.
Otherwise, the markets were mixed early in the week. Tuesday, the S&P was up more than 2.25%. Several points of mixed economic data were released this week, as well. The Consumer Price Index top-line number, which includes food and energy, was down 0.2% because gas prices were down 2.9%. The core number was up 0.1%. Wide slack in the economy and a halt in previously rallying commodity prices are keeping inflation firmly in check. The Producer Price Index was down slightly. Surprisingly new housing starts were down approximately 11% from the previous month.
Unfortunately we did not hear encouraging employment numbers as initial unemployment claims increased as did the total number of unemployed workers. However, industrial production was up with capacity utilization up 1%.
Overall we are excited for earnings season to start. FedEx earnings trailed expectations, however during their conference call, the company stated they are excited for the strong growth they have now.
In our opinion, many companies are running very tight in this economy so as sales pick up, profits are skyrocketing. Next year we expect companies to begin with capital expenditures, investments and hiring more people, so profits will not be as strong.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
