WHY DID CONSUMER SPENDING DECLINE IN JULY?
Last month’s 0.1% dip surprised analysts. In inflation-adjusted terms, the Commerce Department measured the pullback at 0.2%. Household confidence, though, continues to increase. The University of Michigan’s consumer sentiment index finished August at 82.5, up from 81.8 at the end of July and refuting the Wall Street Journal consensus forecast for a retreat to 80.2. The slightly more respected Conference Board consumer confidence index also got an August bump, rising to 92.4 from the previous 90.3 reading.1,2
HOME PRICE GROWTH CONTINUES TO MODERATE
So indicates the June S&P/Case-Shiller Home Price Index: its 20-city composite index shows a year-over-year overall increase of 8.1% (down from 9.3% in May). It did post a 1.0% monthly gain. The National Association of Realtors said pending home sales increased 3.3% in July, while the Census Bureau found new home buying declining 2.4% last month.2
RECORD MONTHLY LEAP FOR DURABLES
According to the Census Bureau, July saw a 22.6% gain in hard goods orders. What was behind that? A record order for Boeing jets. Minus transportation orders, core durable goods orders actually dipped 0.8% in July.2,3
BROAD BENCHMARK SURPASSES 2,000
The S&P 500 crawled over that important psychological milestone last week and stayed above it at week’s end, settling Friday at 2,003.37 and gaining 0.75% in five days. Last week also saw advances for the DJIA (+0.57% to 17,098.45) and the NASDAQ (+0.92% to 4,580.27).4