The S&P 500 has violated its key long-term support level of 1380. This support line (trend) has been in place since Thanksgiving of last year and is an important signal to investors. This does not mean that stocks are ready to fall off the cliff, but it does suggest that there is greater downside risk in the markets and all investors should pause and evaluate their portfolios at this time.
We have a number of important economic reports coming out this week. The biggest, in my view, is the October Retail Sales report scheduled for release at 8:30 AM on Wednesday. Consensus is expecting a drop of 0.1% compared to an increase of 1.1% in September. This report is always important because of the importance consumer spending is to our GDP. The October Producer Price Index report on Wednesday morning and the October Consumer Price Index report on Thursday will give investors a sense of the rate of inflation in the country. Expectations are that price increases will be muted compared to September’s numbers. The weekly Initial Jobless Claims number on Thursday is expected to increase from 355,000 the week before to 376,000, and October’s Industrial Production report on Friday is expected to show an increase of 0.2% following September’s increase of 0.4%.
In honor of Veteran’s Day I would like to ask everyone to take a moment to thank a a soldier, sailor, marine, or airman for their service. I am blessed to have a step-grandfather who served in World War I, another grandfather who served in WWII, a father who served in Korea and Vietnam, and a step-father and father-in-law who also served in Vietnam. I am always mindful of their service to this great nation and we should never forget the sacrifice that these, and millions of other, men and women have made for our great country.
After much thought and consideration, I have decided to reduce my Market Commentaries to every other week rather than weekly for now. The holidays are a welcome distraction for all of us and the time we spend with our families is important, and I have some additional writings I want to complete regarding individual investors and their retirement plan investing. You will be able to find those writings on the NTrust Facebook page (as you can all of my market commentaries), as well as on LinkedIn, and on blogger.com. So going forward, please look for my market commentary every other week.