Well what a week for the markets! We tested the all time high of the Dow on both Thursday and Friday, but failed to pass the threshold. The driving home fear on Friday, though, was fresh data that reinstated fears of inflation.
Recap of Weekly Performance:
DJIA- Up 170.97 or 1.49%
S&P 500- Up 21.07 or 1.60%
NASDAQ- Up 39.50 or 1.78%
As stated this week the markets experienced extraordinary gains, but we will have to watch inflation in the near term. The Commerce Department reported that personal consumption increased by 2.50% in August, which is the largest increase in eleven years. The reason for concern is that the Federal Reserve feels safe having that figure under 2%, which concerns investors that the Fed could perceive this as inflationary in nature. We will have to monitor this closely in the future.
Crude oil gained some this week, after a few weeks of sell-off, gaining $2.36/barrel or up 3.90% on the week.
Overall, it is a time to rejoice and enjoy this short term spike in equity prices, but the main question is can the markets hold this position or sell off to the 11,000 level. Do not be surprised if this week the markets do gain some initially, but sell back off later in the week. Remain prudent in your stock selections and continue to look for values even in high prices as we are currently experiencing. Until next week have a productive and profitable week!