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Weekly Economic Update 10/24/2011

October 24, 2011

John Jastremski Presents:

WEEKLY ECONOMIC UPDATE

10-24-2011

ANNUALIZED INFLATION HITS 3.9%
So noted the Bureau of Labor Statistics last week. The Consumer Price Index rose 0.3% during the month of September, with core CPI rising 0.1%, the smallest such increase in six months. (Annualized core consumer inflation was at 2.0%.) The Producer Price Index climbed 0.8% for September after a flat August.1

HOMEBUYING TAPERS OFF IN SEPTEMBER
Existing home sales decreased by 3.0% last month, according to the National Association of Realtors. At this rate, about 4.91 million previously occupied homes will be sold in 2011, matching the total for 2010. In a normal year, about 6 million residential resales occur in the real estate sector.2

HOUSING STARTS UP 15%
Here’s a good sign for residential real estate: a sign of demand. Most of the 15.0% monthly increase in September came from apartment construction; the Commerce Department reported a 53% monthly jump in that category. Single-family construction improved by 1.7%. Overall, there were 658,000 housing starts last month, the best number in any month since April 2010.3

DOW EXTENDS WINNING STREAK
Wall Street rallied Friday on the eve of the crucial summit meeting to address the Eurozone debt crisis, helped by news that a new aid package for Greece had been approved by EU finance ministers. The DJIA gained ground for the fourth week in a row; the S&P 500 also advanced. The weekly numbers: S&P 500, +1.12% to 1,238.25; DJIA, +1.41% to 11,808.79; NASDAQ, -1.14% to 2,637.46.4,5

THIS WEEK

Earnings season is in full swing. Monday, earnings reports from Netflix, Amgen, Caterpillar and Texas Instruments hit the Street. On Tuesday, BP, Deutsche Bank, Amazon.com, Broadcom, DuPont, UBS and 3M issue 3Q results … and the August Case/Shiller Home Price Index comes out along with the Conference Board’s October gauge of consumer confidence. On Wednesday, quarterly results arrive from Boeing, VISA, GlaxoSmithKline, Sprint, ConocoPhillips and Ford and we have data on September new home sales and durable goods orders. Thursday brings the initial estimate of 3Q GDP and the data on September pending home sales, plus earnings from ExxonMobil, Occidental Petroleum, Baidu, P&G, Aetna, Bristol-Myers Squibb, Time Warner Cable, Hershey and Motorola Solutions. Friday, earnings from Merck and Chevron come out along with the report on September consumer spending and October’s final University of Michigan consumer sentiment index.

% CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG
DJIA +2.00 +5.94 -0.32 +2.59
NASDAQ -0.58 +7.23 +2.52 +5.44
S&P 500 -1.54 +4.91 -1.90 +1.36
REAL YIELD 10/21 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO
10 YR TIPS 0.23% 0.50% 2.53% 3.50%

Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 10/21/114,5,6,7,8 Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.

This material was prepared by Peter Montoya Inc, and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

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John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

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