Equity Markets Closed Lower Last Week

Last week saw stocks close markedly lower as investors were discouraged by hawkish comments from Federal Reserve Chair Jerome Powell, who put a damper on the likelihood of another interest rate decrease this year. Among the market sectors, energy, financials and utilities closed the week higher, while the remaining sectors ended the week in the red, led by health care, which saw stocks fall after president-elect Trump’s appointment of Robert Kennedy as secretary of the Department of Health and Human Services. Ten-year Treasury yields hovered near the highest level since June, reflecting the diminished probability of interest rate cuts. Crude oil and gold prices declined, while the dollar advanced.

October CPI Increased in Line With Prior Month

The Consumer Price Index rose 0.2% in October, the same increase as in each of the previous three months. For the 12 months ended in October, the CPI increased 2.6%, up 0.2 percentage points from the same period ended in September. Prices, excluding food and energy, rose 0.3% in October and 3.3% over the last 12 months. Prices for shelter rose 0.4% in October, accounting for over half of the monthly increase. Food prices also increased over the month. Prices for energy were unchanged over the month after declining 1.9% in September.

Eye on the Week Ahead

The focus is on the housing sector this week. The report on housing starts for October is out on Tuesday. September saw the number of housing starts and issued building permits decline. Also out this week is the report on existing home sales for October. Sales fell in September from the previous month as did the median sales price.