The Dow this week surpassed not only the record closing high, but the record intra-day high as well. On Friday the Labor department released economic data concerning employment, and the continued fears of inflation and further Federal Reserve interest rate increases still exist.
This weeks snapshot
DJIA: Up 171.14 or 1.47%
S&P 500: 13.73 or 1.03%
NASDAQ: Up 41.56 or 1.84%
The Dow is now up over 10% for the year, with all of the other major indices reporting positive yearly gains. Although this weeks performance of the Dow is a reason to celebrate the accomplishment there are reasons to doubt its ability to sustain this level long term. Further, if inflation is taken into account the Dow is still quite far away from the 2000 high.
On Friday the Labor Department released the employment report for September, reporting that 51,000 new jobs were created. This was much less than the anticipated 125,000 that Wall Street was expecting, but there have been major revisions of past monthly job growth that offset this low number. The economy is still flirting with the idea of a soft landing, but fears of both increased inflation and thus increased rate hikes or the prospect of the economy slipping into a recession still exist.
Crude Oil fell significantly this week loosing $3.15/barrel or 5.01%. This was due to increased inventories reported, as well the decease in the likelihood that OPEC producing countries would cut output in the near future.
Overall the markets have had an impressive run in September, which is normally a weak month for the markets in general. We however feel that values still exist in the marketplace, but there are definitely currently overpriced securities due for a pullback. Until next week have a productive and profitable week!