Market Week in Review

S&P 500 1,484.25 +2.11%*

Click here for the Weekly Wrap by Briefing.com.

*5-Day Change

Weekly Scoreboard*

Indices
S&P 500 1,484.25 +2.11%
DJIA 13,442.52 +2.51%
NASDAQ 2,602.18 +1.42%
Russell 2000 783.49 +.99%
Wilshire 5000 14,890.99 +1.90%
Russell 1000 Growth 597.67 +1.74%
Russell 1000 Value 831.35 +2.31%
Morgan Stanley Consumer 718.82 +2.07%
Morgan Stanley Cyclical 1,012.10 +.82%
Morgan Stanley Technology 640.63 +1.23%
Transports 4,796.62 +1.35%
Utilities 497.53 +2.54%
MSCI Emerging Markets 136.85 +2.67%

Sentiment/Internals
NYSE Cumulative A/D Line 67,113 +1.35%
Bloomberg New Highs-Lows Index -116 +46.05%
CFTC Oil Large Speculative Longs 231,243 +4.4%
Bloomberg Crude Oil % Bulls 17.0 -19.9%
Total Put/Call 1.08 -6.09%
NYSE Arms .92 -65.9%
Volatility(VIX) 24.92 -4.99%
ISE Sentiment 136.0 -11.69%
AAII % Bulls 40.0 +4.2%
AAII % Bears 35.29 -16.8%

Futures Spot Prices
Crude Oil 79.10 +3.14%
Reformulated Gasoline 203.64 +2.54%
Natural Gas 6.27 +13.75%
Heating Oil 220.78 +2.95%
Gold 717.80 +1.03%
Base Metals 234.35 +1.45%
Copper 339.25 +4.11%

Economy
10-year US Treasury Yield 4.46% +8 basis points
4-Wk MA of Jobless Claims 324,000 -.30%
Average 30-year Mortgage Rate 6.31% -15 basis points
Weekly Mortgage Applications 657.40 +5.54%
Weekly Retail Sales +2.80%
Nationwide Gas $2.80/gallon -.01/gallon
US Cooling Demand Next 7 Days 3.0% below normal
ECRI Weekly Leading Economic Index 140.60 +.07%
US Dollar Index 79.62 -.43%
CRB Index 320.92 +2.75%

Best Performing Style
Large-Cap Value +2.31%

Worst Performing Style
Small-cap Value +.68%

Leading Sectors
Restaurants +6.50%
I-Banks +4.67%
Engineering & Construction +4.59%
Gaming +4.29%
Defense +3.20%

Lagging Sectors
Alternative Energy +.24%
Hospitals -.23%
Tobacco -.95%
Networking -1.32%
Semis -1.77%

One-Week High-Volume Gainers

One-Week High-Volume Losers

*5-Day Change

Import Prices Fall, Advance Retail Sales Rise Less Than Estimates, Production Decelerates, Consumer Confidence Rises Slightly

- The Import Price Index for August fell .3% versus estimates of a .2% gain and a downwardly revised 1.3% increase in July.

- Advance Retail Sales for August rose .3% versus estimates of a .5% gain and an upwardly revised .5% gain in July.

- Retail Sales Less Autos for August fell .4% versus estimates of a .2% gain and an upwardly revised .7% increase in July.

- Industrial Production for August rose .2% versus estimates of a .3% gain and an upwardly revised .5% increase in July.

- Capacity Utilization for August was 82.2% versus estimates of 82.0% and an upwardly revised 82.2% in July.

- Preliminary Univ. of Mich. Consumer Confidence for September rose to 83.8 versus estimates of 83.5 and a reading of 83.4 in August.

BOTTOM LINE: Prices of goods imported into the US unexpectedly fell in August as oil and natural gas costs dropped, Bloomberg reported. Import prices rose 1.9% year-over-year, right near the long-term average, versus a 2.8% increase in July. The price of imported natural gas fell 13% last month, the largest decline since January. The cost of goods from China rose .3%, while prices of goods from Latin America were unchanged. Import prices will likely bounce back next month on the recent bounce higher in energy prices. However, I expect import price deceleration to resume shortly thereafter.

Retail sales in the US rose less than forecast in August, pressured by falling gas station receipts, Bloomberg reported. Retail sales ex-autos, filling stations and building materials, which the government uses to calculate consumer spending for GDP, actually rose 0.1% on top of a very strong 0.8% gain the prior month. As well, sales at furniture and electronics stores rose, and auto dealerships and parts sales jumped 2.8%, the most since July 2006. Filling station receipts fell 2.4%, the most since October of last year. Weekly retail chain-store-sales have been improving and were right near long-term average levels this week. I expect retail sales to continue to improve modestly over the intermediate term as the job market remains healthy, interest rates remain low, inflation decelerates further, stocks resume their major uptrend, energy prices start falling again, housing fears subside and consumer sentiment improves.

Consumer Confidence improved slightly so far this month, Bloomberg reported. The expectations component of the index rose to 74.4 versus 73.7 in August. The Current Conditions component slipped to 98.3 from 98.4 in August. Consumers expect inflation to rise 3.1% over the next year versus expectations of a 3.2% gain the prior month. I expect both main gauges of consumer sentiment to approach cycle highs over the intermediate-term.

Inventories at US businesses increased more than forecast in July, Bloomberg reported. Sales rose 1.1%, led by a rebound at manufacturers, versus a .3% decline in July. Companies had enough goods on hand to last just 1.26 months at the current sales pace, down from the prior month. I continue to believe inventory rebuilding will help boost US economic growth over the intermediate-term as companies gain confidence in the sustainability of the current expansion.

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***Technical Difficulties***

Due to internet connection problems I am unable to post the Friday Watch. Hopefully I will be back up and posting tomorrow. Sorry for the inconvenience.

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