Money Talk Podcast

Landaas & Company newsletter  November edition now available. Advisors on This Week’s Show Kyle Tetting Art Rothschild Steve Giles (with Max Hoelzl and Joel Dresang engineered by Jason Scuglik) Week in Review (Nov. 13-17, 2023) Significant Economic Indicators & Reports Monday No major announcements Tuesday Inflation continued to slow in October, thanks in part to lower […]

Landaas & Company newsletter  November edition now available. Advisors on This Week’s Show Kyle Tetting Tom Pappenfus Kendall Bauer (with Max Hoelzl and Joel Dresang, engineered by Blake Miller) Week in Review (Nov. 6-10, 2023) Significant Economic Indicators & Reports Monday No major releases Tuesday Imports rose more than exports in September, widening the U.S. […]

Landaas & Company newsletter  October edition now available.

Advisors on This Week’s Show

Kyle Tetting

Adam Baley

Mike Hoelzl

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Oct. 30-Nov. 3, 2023)

Significant Economic Indicators & Reports

Monday

no significant reports

Tuesday

Housing prices continued gaining in August, according to the S&P CoreLogic Case-Shiller national home price index. The measure showed broad gains in prices across the country with year-to-year price increases accelerating in 19 of 20 cities studied. The national index was up 2.6% from the year before, vs. a 1% year-to-year gain in July. The index was 6.4% ahead of its recent bottom in January. A spokesman for the index explained the rising prices by saying that higher mortgage rates have been suppressing the supply of houses for sale more than the demand.

The Conference Board said its consumer confidence index dipped in October for the third month in a row, suggesting expectations for an economic recession. The business research group said consumers are preoccupied with rising prices and expressed concerns about political volatility and global uncertainty, including war in the Middle East. The Conference Board repeated its prediction of a short, shallow downturn in the first half of 2024.

Wednesday

The manufacturing sector contracted in October for the 12th month in a row, according to the Institute for Supply Management. The trade group’s index, based on surveys of industry purchasing managers, showed new orders declining at a faster rate while production grew, though slower than it had in September. Employment fell after having expanded the month before, and some companies reported considering layoffs. The group said based on past index readings, the U.S. gross domestic product is receding at an annual rate of 0.7%.

The Commerce Department said construction spending rose slightly in September, aided by single-family housing. At a seasonally adjusted annual rate of nearly $2 trillion, expenditures were up 0.4% from the August pace and up almost 9% from the year before. Spending on residential construction, which accounted for 44% of the total, rose 0.6% for the month but was 2.1% lower than the year-ago pace. Expenditures on factory construction fell 0.4% from August but was up 62% from the year before.

Job openings rose slightly in September, another sign of the labor market’s resilience so far amid Federal Reserve Board efforts to slow the economy. Openings rose 0.6% from August to 9.6 million positions, the Bureau of Labor Statistics reported. That was 12% below the September 2022 level but still higher than the 7 million mark just before the COVID pandemic. The report showed little change in the numbers and rates of hires, separations and quits. Compared to the number of unemployed people actively seeking jobs, demand for workers outnumbered supply by about 3 million, little changed from August.

Thursday

The four-week moving average for initial unemployment claims rose for the second week in a row, though the level continued to reflect tight labor conditions. The measure was 43% below the all-time average, according to Labor Department data. The report said 1.6 million Americans claimed jobless benefits in the latest week, up 2% from the week before and up 28% from the year before.

The Bureau of Labor Statistics said the annual rate of worker productivity rose in the third quarter by 4.7%, the most in three years. Measuring year to year, third-quarter productivity rose 2.2% for the third consecutive acceleration. Over the last four quarters, productivity rose because output, which was up 3.1%, exceeded the 0.8% increase in hours worked. Hourly compensation rose at a 3.9% annual rate in the third quarter, so labor costs fell 0.8%. Measured from the third quarter of 2022, labor costs gained 1.9%.

The Commerce Department said the value of factory orders rose 4.7% in September for the sixth increase in seven months. Growth was led by sizable sales of commercial aircraft. Excluding the volatile transportation category, orders rose 0.8% for the month. Year to year, total orders were 0.7% higher than they were in September 2022. Excluding transportation, orders were down 1.4% in the same period. Demand for core capital goods, a proxy for business investments, rose 0.5% from August and were up 1.9% from the year before.

Friday

U.S. employers added 150,000 jobs in October, below the 12-month average of 258,00 and another sign that economic growth may be slowing. According to jobs data from the Bureau of Labor Statistics, August and September gained 101,000 fewer jobs than previously estimated. The average wage was up 4.1% from the year before, the slowest increase since June 2021, though still outpacing general inflation. The unemployment rate ticked up to 3.9% in October, the highest in nearly two years, but continued the longest streak below 4% since the 1960s.

The service sector of the U.S. economy grew in October for the 10th month in a row, though at the slowest rate since May. The Institute for Supply Management said its services index showed new orders growing faster than in September while inventories and export orders declined. The trade group said its survey of purchasing managers suggests the overall economy was growing at an annual rate of 0.7%.

 MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13478, up 835 points or 6.6%

Standard & Poor’s 500 – 4358, up 241 points or 5.9%

Dow Jones Industrial – 34061, up 1643 points or 5.1%

10-year U.S. Treasury Note – 4.56%, down 0.29 point

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Advisors on This Week’s Show

KYLE TETTING

STEVE GILES

KENDALL BAUER

(with Max Hoelzl, and Joel Dresang, engineered by Jason Scuglik)

Week in Review (Oct. 23-27)

Significant Economic Indicators & Reports

Monday

No major releases

Tuesday

No major releases

Wednesday

The annual rate of new home sales jumped 12% in September to its fastest pace since February 2022, just before the Federal Reserve began raising interest rates. The volatile indicator from the Commerce Department was 34% ahead of its pace in September 2022 and above the level just before the COVID pandemic. The supply of new houses available for sale reached its lowest level in a year and a half, though it remained higher than just before the pandemic. The median sale price was $418,800, down 12% from the year before.

Thursday

The U.S. economy rose at an annual pace of 4.9% in the third quarter, the fastest rate in seven quarters. Adjusted for inflation, gross domestic product reached a record $22.2 trillion and was up 2.9% from the year before, according to the Bureau of Economic Analysis. Consumer spending, which generates about 70% of economic activity, advanced at a 4% annual rate, also the highest since the end of 2021. Spending on housing increased for the first time in 10 quarters. The Federal Reserve Board’s preferred measure of inflation rose 3.4% from the third quarter of 2022, down from a four-decade high of 6.8% in mid-2022. The Fed’s long-range target is 2%.

Demand for long-lasting manufactured products rose 4.7% in September, the first gain in three months. The Commerce Department said durable goods orders  through the first nine months of 2021 were up 4.4% from the same time in 2022. Orders for commercial aircraft led the monthly increase, but excluding the volatile transportation category, orders rose just 0.5% from August. Year to year, orders excluding transportation also rose 0.5%. Core capital goods orders, a proxy for business investment, rose 0.6% from August and were up 1.9% from September 2022.

The four-week moving average for initial unemployment claims rose for the first time in eight weeks. Data from the Labor Department showed the new-claim average was still 43% below the 56-year average, a reminder of the relatively tight labor market. In the latest week, just below 1.6 million Americans claimed jobless benefits, down 0.8% from the week before but up 25% from the year before.

The National Association of Realtors said its pending home sales index rose 1.1% in September, though it was still down 11% from the year before. The trade association blamed 20-year high mortgage rates and tight inventories for keeping prices high and dampening demand. The group forecast a 17.5% decline in home sales for 2023 to 4.15 million units. It projected a 13.5% rebound in 2024 to 4.71 million. The Realtors estimated the median sales price to reach $389,500 in 2024, which would be a 0.7% increase from their projection for 2023.

Friday

The Bureau of Economic Analysis said consumer spending rose 0.7% in September, as personal income gained 0.3%, lowering the personal saving rate to 3.4% of disposable income, the lowest since December. Consumer spending increased both in goods (led by new cars) and services (led by international travel). The personal consumption expenditures index, the Federal Reserve’s favorite measure for inflation, stayed at a year-to-year rate of 3.4% for the third month in a row. That’s down from a 20-year high of 7.1% in June 2022 and still up from the Fed’s long-run target of 2%.

Often a pre-cursor to spending, consumer sentiment sank in October but stayed above year-ago levels, which were near all-time lows. The University of Michigan reported that its survey-based index declined because of ongoing concern over inflation as well as uncertainty over domestic and international headlines. Consumers with higher incomes and heavier stock holdings drove the decline. Survey respondents expected inflation to reach 4.2% next October, the highest forecast since May. Long-term expectations stayed in the 2.9% to 3.1% range.

 MARKET CLOSINGS FOR THE WEEK

Nasdaq – 12643, down 341 points or 2.6%

Standard & Poor’s 500 – 4117, down 107 points or 2.5%

Dow Jones Industrial – 32418, down 710 points or 2.1%

10-year U.S. Treasury Note – 4.85%, down 0.08 point

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Advisors on This Week’s Show

Kyle Tetting

Art Rothschild

Tom Pappenfus

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Oct. 16-20, 2023)

Significant Economic Indicators & Reports

Monday

No major announcements

Tuesday

In a further sign of economic resilience, retail sales advanced 0.7% in September. The Commerce Department reported that 10 of 13 major categories had sales increases in September, including a 1.1% gain for online retailers and a 1% bump for car dealers. Appliance stores, home-and-garden centers and clothing stores experienced declines. Sales at bars and restaurants rose by 0.9%, an indication that consumers remain comfortable spending. Consumer spending drives nearly 70% of U.S. economic activity.

The Federal Reserve reported that industrial production rose 0.3% in September and capacity utilization advanced to its long-term average for the first time in five months. The capacity rate, a measure of potential inflation pressure, suggested that factories, mines and utilities were regaining balance after months of underusing their operations. The capacity rate for factories stayed below its long-run average for the fifth month in a row. The Fed said total industrial output was up just 0.1% from September 2022 and had grown at an annual rate of 2.5% in the third quarter. Manufacturing production rose 0.4% in September and was down 0.8% from the year before.

Wednesday

The U.S. housing market continued to suggest weakness in September as the pace for both housing starts and building permits stayed below pre-pandemic levels. Figures from the Commerce Department showed new construction, including multi-family units, about 25% below its pace in mid-2022. Starts for single-family houses have been below their pre-COVID level since May 2022. The pace of housing permits, an indicator of commitments to future homebuilding, also has hovered lower since the Fed began raising interest rates in 2022. Single-family housing permits, however, rose in September for the eighth month in a row, though still below the pre-pandemic level. And though new construction has been slowing, data showed that the rate of houses under construction stayed near record level, despite 14 consecutive declines for single-family units.

Thursday

The four-week moving average for initial unemployment claims fell for the seventh week in a row, dipping to its lowest point since the beginning of February. The measure of employers’ reluctance to let workers go was 44% behind the long-term average, dating to 1967. According to Labor Department data, total jobless claims fell below 1.6 million in the latest week, down nearly 2% from the week before, though up 29% from the year before.

The pace of existing home sales sank 2% in September, descending to its lowest mark in 13 years. The National Association of Realtors cited limited inventory and low affordability fueled by rising mortgage rates. Houses sold at an annual rate of 3.96 million, down 15.4% from September 2022, the Realtors reported. Inventory rose 2.7% from August to 1.1 million houses, the lowest for September since 1999. The trade group said the median sales price in September was $394,300, up 2.8% from the year before.

The Conference Board said its index of leading economic indicators declined 0.7% in September, shrinking for the 18th month in a row. Of 10 components in the index, nine were either negative or flat. The six-month pace of contraction slowed from the preceding six months. Still, the business research group forecast a shallow recession for the first half of 2024.

Friday

No major announcements

 MARKET CLOSINGS FOR THE WEEK

Nasdaq – 12984, down 423 points or 3.2%

Standard & Poor’s 500 – 4224, down 104 points or 2.4%

Dow Jones Industrial – 33126, down 544 points or 1.6%

10-year U.S. Treasury Note – 4.92%, up 0.30 point

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Advisors on This Week’s Show

Kyle Tetting

Steve Giles

Kendall Bauer

(with Max Hoelzl, and Joel Dresang, engineered by Jason Scuglik)

Week in Review (October 9-13, 2023)

Significant Economic Indicators & Reports

Monday

No major announcements

Tuesday

No major announcements

Wednesday

Prices on the wholesale level rose more than analysts expected in September, fueled by increases in energy costs. The Bureau of Labor Statistics said its Producer Price Index rose 0.5% from August. Demand for goods climbed 0.9%. Since September 2022, the PPI rose 2.2%, the fastest rate since April, but down from an 11.7% one-year pace in March 2022. Excluding volatile prices for food, energy and trade services, the core PPI advanced 0.2% for the month and was up 2.8% from the year before, which was on par with recent months and down from 7.1% in March 2022.

Thursday

Shelter costs accounted for more than half of the 0.4% increase in inflation in September. The Bureau of Labor Statistics said gasoline prices also added to its Consumer Price Index. The gain was down from 0.6% in August. In the latest 12 months, the broadest measure of inflation rose at a 3.7% pace, tied with August for the slowest in 30 months and down from 9.1% in June 2022. The core CPI, which strips out volatile costs for food and energy, rose 0.3% from August and 4.1% from September 2022. The year-to-year rate was the lowest in two years and down from 6.6% a year ago.

Based on CPI data, the Social Security Administration announced a 3.2% adjustment to benefits in 2024. That was a drop from 8.7% in 2023, the biggest raise for Social Security recipients since 1981. The average cost-of-living adjustment since Social Security began adjusting benefits to inflation in 1975: 3.8%. Social Security said the average recipient can expect an added $50 in their benefit checks, beginning in January.

The four-week moving average for initial unemployment claims sank for the sixth week in a row, reaching 44% below the all-time average and the lowest level since January. The Labor Department said fewer than 1.6 million Americans claimed jobless benefits in the most recent week, down 0.2% from the week before but up 28% from the same time last year. The historically low claims numbers illustrate the reluctance of employers to let workers go in a tight labor market.

Friday

A preliminary reading of consumer sentiment in October showed lower confidence because of higher expectations for inflation. The survey-based index from the University of Michigan dropped 7.5% from where it stood at the end of September. It was 5.2% ahead of where it was in October 2022. One-year expectations for inflation rose to their highest level since May, staying well above the range before the pandemic. Long-term expectations also edged up. According to the university, expectations for rising prices tend to stifle consumer spending, which drives nearly 70% of U.S. economic activity.

 MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13407, down 24 points or 0.2%

Standard & Poor’s 500 – 4328, up 19 points or 0.4%

Dow Jones Industrial – 33671, up 263 points or 0.8%

10-year U.S. Treasury Note – 4.63%, down 0.16 point

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Advisors on This Week’s Show

Kyle Tetting

Adam Baley

Dave Sandstrom

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Oct. 2-6, 2023)

Significant Economic Indicators & Reports

Monday

Manufacturing continued its slump in September, according to the Institute for Supply Management’s manufacturing index. The index signaled contraction for the 11th month in a row, although at the highest level in that period. Purchasing managers surveyed by the trade group said that along with a slowdown in demand for manufactured items, their production execution and supply chains have improved. The index also reported an expansion in hiring.

The Commerce Department said the annual rate of construction spending rose in August for the eighth month in a row. The rate of $1.98 trillion was 7.4% above the year-ago pace. Residential expenditures, which accounted for 45% of total spending, increased from the August pace but were 3% slower than the year before because of a drop in multi-family housing construction. Spending on manufacturing construction (about 10% of all expenditures) rose 66% from the year before.

Tuesday

Employers expanded job openings in August for the first time in four months. According to the Bureau of Labor Statistics, the number of help-wanted posts rose nearly 8% to 9.6 million openings. Employers in professional and business services showed the biggest need for workers. Demand for employees has slid from an all-time high of 12 million openings in March 2022 but remained above the pre-pandemic level of 7 million. Data showed little change in the numbers of hires or separations. The level of employees quitting their jobs – a sign of worker confidence – was on par with both July and February 2020. Quits peaked in late 2021 and early 2022.

Wednesday

Orders for factory goods rose in August for the fifth time in six months, the Commerce Department reported. Manufacturing orders were up 1.2% from July, following a 2.1% decline from June. Compared to August 2022, orders were up 0.5%. Excluding volatile orders for transportation equipment, demand for factory goods rose 1.4% from July and was down 1.5% from the year before. Core capital goods orders, a proxy for business investments, rose 0.6% for the month and were up 2.1% from August 2022.

The U.S. services sector continued expanding in September, though at a slightly slower pace, according to the Institute for Supply Management. The trade group’s services index showed the ninth consecutive month of expansion, with signs of slower movement in new orders and hiring. The ISM said based on past history, the index suggested the entire U.S. economy was growing at a 1.3% annual pace.

Thursday

The U.S. trade deficit shrank 10% in August to $58.3 billion. The deficit, which detracts from gross domestic product, resulted from a 0.7% decrease in the value of imports bought and a 1.6% rise in exports sold. The decline in imports was led by crude oil and cell phones, while crude oil, cars and travel services helped exports grow. Through the first eight months of 2023, the trade gap narrowed nearly 21% from the year before as imports fell by 4% and exports increased by 1%.

The four-week moving average for initial unemployment claims sank for the fifth week in a row, reaching the lowest level since February. Data from the Labor Department showed average new applications for jobless benefits dipped 43% below the 56-year average, underscoring employers’ reluctance to let workers go. More than 1.6 million Americans were receiving unemployment benefits in the latest week, down 3% from the week before and up 29% from the same time in 2022.

Friday

Employers added 336,000 jobs in September, above the 12-month average of 267,000 and the 33rd consecutive month of gains. The Bureau of Labor Statistics reported broad increases in payroll jobs, led by the leisure and hospitality industry, with bars and restaurants finally regaining their pre-pandemic staffing level. Average hourly wages rose 4.2% from the year before, a slight decline for the third month in a row. Wage rates have outpaced inflation since May. A separate household survey showed the unemployment rate staying at 3.8% in September, the 19th consecutive month below 4%, which hasn’t happened since the 1960s.

 MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13431, up 212 points or 1.6%

Standard & Poor’s 500 – 4309, up 20 points or 0.5%

Dow Jones Industrial – 33408, down 100 points or 0.3%

10-year U.S. Treasury Note – 4.78%, up 0.21 point

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Advisors on This Week’s Show

Kyle Tetting

Art Rothschild

Mike Hoelzl

(with Max Hoelzl, Joel Dresang, engineered by Reuben Neese)

Week in Review (Sept. 25-29, 2023)

Significant Economic Indicators & Reports

Monday

No major releases

Tuesday

Housing prices reached an all-time high July, according to the S&P CoreLogic Case-Shiller home price index. The previous peak was in June 2022, after which price increases decelerated for six months. The index shows home prices up 1% from the year before. An S&P analyst said higher mortgage rates and economic weakness could offset momentum, but the breadth and strength of the July data were encouraging.

The Conference Board said its consumer confidence index fell in September for the second month in a row as short-term expectations dipped below the level that historically indicates a recession in the next year. The business research group said more consumers are registering fears of a downturn as well as rising prices and political disruption. The group said it expects a shallow recession in the first half of 2024.

The seasonally adjusted annual rate of new home sales fell nearly 9% in August, although it was up almost 6% from the year before. The Commerce Department reported that the median price for a new house fell 2% from the year before to $430,300. The supply of new houses rose to the highest level since March.

Wednesday

The Commerce Department said orders for durable goods rose in August for the fifth time in six months. The 0.2% increase was broadly distributed. A rise in defense orders offset a decline in commercial aircraft contracts. Excluding transportation equipment, orders rose 0.4%; they declined 0.7% when defense orders were excluded. Total durable goods orders were up 4.2% from August 2022. Core capital goods orders, a proxy for business investments, rose 0.9% from July and were up 10% from the year before.

Thursday

The U.S. economy grew at an annual pace of 2.1% in the second quarter of 2023, according to a final estimate of the gross domestic product. The rate was unchanged from a previous estimate by the Bureau of Economic Analysis and down from 2.2% in the first quarter. Measured year to year, the economy grew 2.4%. Consumer spending, which drives more than two-thirds of the economy, was slower than initially estimated. Slower spending drove the personal saving rate up to 5.2% from the previous estimate of 4.7% of disposable income.

The four-week moving average for initial unemployment claims dropped for the fourth week in a row, falling to the lowest level since early February. The average was down 42% from its 56-year average, highlighting employers’ continued reluctance to let workers go. The Labor Department said nearly 1.7 million Americans were claiming unemployment compensation in the latest week, down 0.5% from the week before.

The National Association of Realtors said its index on pending home sales sank more than 7% in August as higher mortgage rates and low inventory diminished demand. Plans to buy houses were down nearly 19% from the year before, the trade group reported.

Friday

Consumer spending increased 0.4% in August, in line with gains in income for the month. Higher prices accounted for some of the spending growth. Corrected for inflation, spending was up 0.1%, according to the Bureau of Economic Analysis. The Federal Reserve’s favorite inflation gauge – the Personal Consumption Expenditure index – also edged up 0.4% in August but was just 0.1% when volatile prices for energy and food were excluded. Since August 2022, the PCE was up 3.5% while the core PCE rose 3.9%, the least since May 2021.

The University of Michigan’s consumer sentiment index rose slightly in September, though it was down marginally from its mid-month mark. The reading of 68.1 was 16% higher than the year before, when sentiment was near a record low. A university economist said uncertainties from union strikes and a looming government shutdown contributed to a holding pattern for consumer attitudes. Expectations for inflation dropped to their lowest point in more than two years.

 MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13219, up 8 points or 0.1%

Standard & Poor’s 500 – 4288, down 32 points or 0.7%

Dow Jones Industrial – 33509, down 455 points or 1.3%

10-year U.S. Treasury Note – 4.57%, up 0.13 point

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Advisors on This Week’s Show

Kyle Tetting

Adam Baley

Tom Pappenfus

with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik

Week in Review (Sept. 18-22, 2023)

Significant Economic Indicators & Reports

Monday

No major announcements

Tuesday

Trends for housing starts and building permits moved in opposite directions, according to the Commerce Department. The annual pace of starts declined 11% from July, sinking to the slowest pace since June 2020. Meanwhile, permits – an indication of future housing construction – rose nearly 7% from July, though they were almost 3% below the pace in August 2022. After pent-up demand and historically low mortgage rates rallied home building to its briskest levels since 2006, activity has tapered off in the last year amid higher interest rates. The pace of single-family houses under construction slowed for the 15th month in a row.

Wednesday

No major announcements

Thursday

Labor market conditions remained robust as the four-week moving average for initial unemployment claims declined for the third week in a row. The measure was 41% below the all-time average and the lowest since February, according to data from the Labor Department, a sign of employers’ continued reluctance to let workers go. Nearly 1.7 million Americans were receiving jobless benefits in the latest week, down from 5% the week before but up 30% from the year before.

The annual rate of existing home sales fell 0.7% to 4 million in August, the third slowdown in three months, down 15% from the year-ago pace. The National Association of Realtors said an ongoing lack of houses for sale continued to raise prices. Inventory dropped to a 3.3-month supply, about half of what the trade association said was needed to stabilize pricing. The median sales price hit $407,100 in August, up nearly 4% from the year before.

The Conference Board’s index of leading economic indicators fell in August for the 17th month in a row. The index declined 0.4% from July because of weaker measures for factory orders, consumer expectations, interest rates and credit conditions. Nearly a year and a half of falling indicators prompted the business research group to forecast a “challenging growth period and possible recession,” with projections of 2.2% economic growth in 2023 and 0.8% in 2024.

Friday

No major announcements

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13212, down 497 points or 3.6%

Standard & Poor’s 500 – 4320, down 130 points or 2.9%

Dow Jones Industrial – 33964, down 654 points or 1.9%

10-year U.S. Treasury Note – 4.44%, up 0.11 point

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Advisors on This Week’s Show

Kyle Tetting

Steve Giles

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Sept. 11-15, 2023)

Significant Economic Indicators & Reports

Monday

No major announcements

Tuesday

No major announcements

Wednesday

The broadest measure of inflation delivered mixed signals from August. For the month, the Consumer Price Index rose 0.6%, the most in 14 months, according to the Bureau of Labor Statistics. A 10.6% jump in the price of gasoline accounted for more than half the increase. Also contributing: Shelter costs, which rose for the 40th month in a row. The core CPI, which excludes volatile prices for food and energy items, rose 0.3% from July. Year to year, the CPI was up 3.7%, after reaching 3% in June. The core index fell to 4.3% from the year before, the lowest in nearly two years.

Thursday

Higher gas prices also boosted inflation on the wholesale level in August. The Bureau of Labor Statistics said its Producer Price Index rose 0.7%, the biggest gain in 14 months. Food prices fell for the fourth time in five months. Excluding food, energy and trade services, the core PPI rose 0.3% for the second month in a row. Since August 2022, the PPI rose 1.6%, which was the most since April. The core PPI was up 3% from the year before, compared to 2.9% in July.

The four-week moving average for initial unemployment claims fell for the second week in a row and the seventh time in 11 weeks, reaching the lowest level since February.  According to Labor Department data, the average moved to 224,500 new applications, 39% below the average since 1967. Just under 18 million Americans claimed jobless benefits in the latest week, down more than 2% from the week before and up about 28% from the year before.

The Commerce Department reported a 0.7% rise in retail sales in August, fueled by higher gas prices. Excluding gas stations, sales rose 0.2% for the month, compared with 0.5% in July. Sales rose in 10 of 13 categories. Sellers of furniture, sporting goods and miscellaneous merchandise experienced declines. Adjusted for inflation, retail sales fell 0.1% in August, the first decline since March.

Friday

U.S. industrial output rose 0.4% in August, the second gain in a row, though down from a 0.7% increase in July. A 5% drop in production from the auto industry held back the measure, the Federal Reserve reported. Output from factories rose 0.1%, but excluding motor vehicles and parts, manufacturing increased 0.6%. Since August 2022, overall industrial production rose 0.2%, with manufacturing output declining 0.6%. Meanwhile, capacity utilization rose marginally, reaching the 50-year average operating rate.

Consumer sentiment stayed relatively steady in early September, according to the University of Michigan. A preliminary index reading of 67.7 was down from 69.5 at the end of August but about 35% above its record low in June 2022. Sentiment remained well below the historical average of 86. The university said consumer outlooks on economic conditions have improved modestly, but threats to shut down the government has the potential to send sentiment sliding.

MARKET CLOSINGS FOR THE WEEK

Nasdaq – 13708, down 53 points or 0.4%

Standard & Poor’s 500 – 4450, down 7 points or 0.2%

Dow Jones Industrial – 34619, up 42 points or 0.1%

10-year U.S. Treasury Note – 4.32%, up 0.06 point

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