Investment Commentary –December 28th, 2016

Market Indices as of Market Close December 28th, 2016
Dow 19,933 (14.40% YTD)
S&P 2,263 (10.76% YTD)
NASDAQ 5,438 (8.61% YTD)
Gold $1,147 (52 Week Low $1,067 High $1,387)
OIL $54.06 (52 Week Low $35.10 High $55.44)
US 10Y Treasury 2.48 (52 Week Low 1.32 High 2.64)

Stocks end lower; Dow drive for 20,000 thwarted again

Stocks gave up early gains, ending broadly lower and near session lows Wednesday with losses led by the tech sector. The Dow industrials came within 20 points of the psychologically important 20,000 milestone in early trade but soon lost steam. The blue-chip gauge DJIA, -0.56% ended the day down 111.36 points, or 0.6%, to end at 19,833.68, according to preliminary figures. The S&P 500 SPX, -0.84% declined 0.8% to 2,249.92. The Nasdaq Composite COMP, -0.89% lost 48.89 points, or 0.9%, to settle at 5,438.56 a day after closing at a record.

Jobless claims tumble 10,000 to 265,000

WASHINGTON (Market Watch) — the number of Americans who applied for unemployment benefits in the week before Christmas fell by 10,000 to 265,000, returning initial claims to the extremely low levels that have been the norm since last summer.
Economists polled by Market Watch had forecast initial claims to total a seasonally adjusted 270,000 in the week running from Dec. 18 to Dec. 24.
In mid-December, new claims had jumped to a six-month high of 275,000. Yet claims usually swing up and down in the period that stretches from Thanksgiving to early January, as many Americans move in and out of the workforce during the holiday shopping season.
Initial claims have been under 300,000 for 95 straight weeks, the longest streak since 1970. Millions of Americans have found work in the past five years, pushing the unemployment rate below 5% and eliciting complaints among businesses about how hard it is to find skilled workers to fill open jobs.
The less volatile four-week average of initial claims, meanwhile, fell by 750 to 263,000, the Labor Department said Thursday. The monthly figure is seen as a less volatile measure.
Continuing jobless claims rose by 63,000 to 2.1 million in the week ended Dec.17. These claims, reported with a one-week delay, reflect the number of people already collecting unemployment checks.

Sprint, OneWeb say 8,000 jobs announced by Trump are part of SoftBank pledge

U.S. President-elect Donald Trump on Wednesday said telecommunications group Sprint Corp (S.N) and a U.S. satellite company OneWeb will bring 8,000 jobs to the United States, and the companies said the positions were part of a previously disclosed pledge by Japan’s SoftBank Group Corp.
SoftBank (9984.T) holds stakes in both companies and its chief, billionaire businessman Masayoshi Son, earlier in December said he would invest $50 billion in the United States and create 50,000 jobs.
Sprint in January said it had cut 2,500 jobs as part of its plan to cut $2.5 billion in costs. On Wednesday it said it would create 5,000 jobs in areas including sales and customer care by the end of its fiscal year ending in March 2018.
Sprint spokesman Dave Tovar said the jobs were part of the pledge made by Son but would be funded by Sprint.
SoftBank and OneWeb had announced on Dec. 19 that the Japanese company was leading a $1.2 billion funding round.
OneWeb plans to use the funds to build a plant in Florida to produce low-cost satellites, creating almost 3,000 jobs at the company and its suppliers.
SoftBank described its $1 billion share of the funding as the first tranche of the $50 billion promised by Son in a meeting with Trump.

Economy In The Tank
With a 1.2 on the Index of Leading Indicators top officials have a bleak outlook for the next years’ economy.

Happy New Year from Affinity Asset Management!

The views presented are not intended to be relied on as a forecast, research or investment advice and are the opinions of the sources cited and are subject to change based on subsequent developments. They are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investments.