Finance: A Week In Review 2.22.2016

1. Weekly Market Update
Data Suggests Modest Economic Expansion through Early 2016
The Conference Board Leading Economic Index declined 0.2% for the
month of January. The 0.2% decline was in-line with estimates. This
is the second consecutive month of decline, with December’s decline
revised to 0.3% from an original 0.2% decline. The press release stated
“Despite back-to-back monthly declines, the index doesn’t signal a
significant increase in the risk of recession, and its six-month growth
rate remains consistent with a modest economic expansion through
early 2016.”
Industrial Production Strong; Capacity Utilization Rises
U.S. industrial production was strong in January, increasing 0.9%
for the month. This was well above consensus estimates. Industrial
production had declined for the previous three consecutive months.
Weather is an attributable factor in the strong January number as the
Source: Morningstar®; Bloomberg index for utilities rose 5.4% for the month as January was much colder
than December. Capacity utilization increased during the month, rising
to 77.1 in January from 76.4 in December.
Core Inflation Exhibits Largest Monthly Increase in Nearly 5 Years
Inflation, as measured by the Consumer Price Index (CPI), was
unchanged on a seasonally-adjusted basis for the month of January.
This follows 0.1% decline in the CPI in December. Core inflation,
Source: CNBC.com Sources: Bloomberg; CNBC.com which excludes food and energy, rose at a seasonally-adjusted 0.3%
for January. This is the largest monthly increase since August 2011.
Jobless Claims Fall to 262,000, Hit 3-Month Low - marketwatch.com The Producer Price Index (PPI) also shows increases occurring in
Claims, a proxy for layoffs, are running at a 42-year low. Even though hiring slowed in January, companies are retaining the vast majority wholesale prices. The seasonally-adjusted PPI rose 0.1% for January;
of their workers in anticipation of steady sales, at least for now. expectations called for a 0.2% decline. Excluding food, energy, and
http://on.mktw.net/1QmIses trade, PPI rose 0.2% on a seasonally-adjusted basis for January.
Negative Interest Rates Are a 'Dangerous' Experiment,' Warns Morgan Stanley - marketwatch.com Housing Starts Decline in January
In their estimation, further moves into negative rates will have much less of an impact on the euro given that most of the portfolio Housing starts for January came in at a seasonally-adjusted annual
adjustment is already complete. Such policy would erode bank profits 5%-10% and risk curbing lending across eurozone borders. rate of 1.1 million units. This marks a 3.8% decline from December’s
http://on.mktw.net/1XxByT3 seasonally-adjusted start of 1.14 million units. Permits also declined,
Fed Minutes Show Concern about Global Market Turmoil - Bloomberg.com falling 0.2% to a seasonally-adjusted annual rate of 1.2 million. Home
Debating their outlook for interest rates last month, policy makers expressed concern that the fall in the commodity prices and the rout in builder sentiment, as measured by the National Association of Home
financial markets increasingly posed risks to the U.S. economy. As a result, plans for tighter policy could be delayed. Builders (NAHB), declined for February. The NAHB/Wells Fargo Housing
http://bloom.bg/1oKlbH5 Market Index fell from a level of 61 in January to 58 in February.
Source: CFA Institute
*Past performance is not indicative of future results. Please refer to page 2 for important disclosures.
Last Week's Headlines
Monday, February 22, 2016
INSIGHTS
6200 ROCKSIDE ROAD CLEVELAND, OHIO 44131 BParris@VanFin.com TEL: (440) 289-8977 FAX: (216) 642-4862 www.VANFIN.com
U.S. Consumer Confidence (February) 2/23/16
U.S. Durable Goods Orders (January) 2/25/16
U.S. GDP (Q4 2015) 2/26/16
U.S. Consumer Sentiment (February) 2/26/16
Looking Ahead (Source: Bloomberg) Date
2/19/16 12/31/15 2/20/15
Oil (WTI) 29.72 37.07 60.17
Natural Gas 1.81 2.35 3.34
Gold 1,227 1,061 1,204
Weekly Commodities Data
Levels (USD)
Equities Level 1 Week 3 Month YTD 1 Year 3 Year
S&P 500 1,917.78 2.91 -7.32 -5.85 -6.58 10.09
Dow Jones Industrial Average 16,391.99 2.75 -6.88 -5.47 -6.48 7.92
Russell 2000 1,010.01 3.93 -13.11 -10.95 -16.58 4.11
MSCI EAFE 4,390.59 4.44 -11.12 -9.08 -14.27 0.03
MSCI Emerging Markets 319.09 4.22 -11.15 -6.60 -22.96 -9.15
1 Week 3 Month YTD 1 Year 3 Year
0.15 1.71 1.93 1.93 2.33
1.52 -5.85 -3.16 -9.64 0.07
-0.21 2.62 1.58 4.33 3.52
BofAML High Yield Master II
Barclays Municipals
Weekly Index Data (For the Period Ending 2/19/16)
Index Returns (%)
Fixed Income
Barclays U.S. Aggregate
2/19/16 12/31/15 2/20/15
10-Year Treasury 1.76 2.27 2.13
PrimeRate 3.50 3.50 3.25
Weekly Rates Data
Levels (%)

2. Weekly Market Update
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Monday, February 22, 2016