Market Commentary for Week Ended 10/25/2019

Stocks ended the week with healthy gains, propelled by better than expected earnings reports and optimism on the phase one trade deal.  This is the third straight week of gains for the major indexes.  The S&P 500 was bumping up against the old time closing high of 3026 for most of the day on Friday.

Source: FactSet

Economic Data Recap

Here is a summary of the notable economic data points released during the week.

1. 10/22 Existing Home Sales: 5.380 M existing homes were sold in the month of September versus a consensus estimate of 5.440 M.  Month to month data in this indicator is volatile so it is best to look at the three-month average which climbed by 0.6% and is at the best reading since May of last year. 
2. 10/24 Durable Goods Orders:  Capital goods orders were weak for the month of September, furthering the narrative that businesses are holding off on making large purchases during the protracted trade war with China.   Here is a summary of the readings:

3. 10/24 New Home Sales:  The reading came in at 701k versus a consensus of 698k.  This is the best reading since the sub-prime crash in 2008.  The housing sector is definitely a bright point in the economy.  Very healthy.
4. 10/25 Consumer Sentiment: The consumer is currently feeling pretty good about their financial situation.  The reading came in at 95.5 for September versus an estimate of 96.   The University of Michigan's Consumer Survey Center questions 600 households each month on their financial conditions and attitudes about the economy.