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Pence Wealth Management Financial Markets Report


  • U.S. stocks opened flat on Friday, with the S&P 500 coming off another record close, as data showed consumer spending fell for the first time in a year in April.
    • The S&P 500 yesterday climbed to its highest level on record, taking its 2014 gains to 3.9 percent and shrugging off a report showing the U.S. economy contracted for the first time in three years from January through March. 
  • Ford recalls nearly 1.4 million vehicles in North America, most for the possible loss of power steering.
  • Lions Gate disappoints with No ‘Hunger Games’, ‘Divergent’ boost.
    • Unlike its movies, Lions Gate’s fourth quarter didn’t live up to the hype. The company reported earnings of $49.2 million, down from $163 million in the year-ago period, below Wall Street estimates.
    • Revenue slid more than 8% to $722 million. Analysts had predicted $823.7 million on average. 
  • Musk says SpaceX reusable capsule could ferry astronauts by 2016.
    • Russia is currently charging as much as $76 million per mission, SpaceX intends to be able to deliver passengers for less than $20 million, Musk said.
    • SpaceX is one of four companies receiving NASA funding to develop rockets and capsules to take astronauts to and from the International Space Station. The others are Boeing, Jeff Bezos’s Blue Origin and Sierra Nevada.
    • SpaceX has received more than $2.5 billion in NASA funding since 2008 for commercial crew and other ventures.
  • Former Microsoft CEO Ballmer bought the Los Angeles Clippersfor a record $2 billion as the wife of Donald Sterling pushed through the sale without gaining the approval of the embattled owner. Shelly Sterling signed a binding contract with Ballmer.
    • The previous record sale price for an NBA team was $550 million paid in April for the Milwaukee Bucks.
    • Ballmer, with a fortune of $18.9 billion, is the 39th-richest person in the world.


  • Consumer spending unexpectedly fell in April after the biggest surge in almost five years as incomes slowed.
    • Household purchases, which account for about 70 percent of the economy, dropped 0.1 percent, the first decrease in a year.
    • Economists had expected it to rise 0.2 percent in April.
  • A price index for consumer spending increased 0.2 percent last month after rising by the same margin in March.
    • That pushed it up 1.6 percent from a year ago, the largest gain since November 2012. It had advanced 1.1 percent in March.
    • Inflation has been suppressed by weak medical care costs related to cuts in government spending.
  • Income increased 0.3 percent last month after rising 0.5 percent in the prior month. Disposable income, the money left over after taxes and adjusting for inflation, increased 0.2 percent.
    • With income growth outpacing spending, the saving rate, which is the percentage of disposable income households are socking away, increased to 4.0 percent from 3.6 percent in March.
    • Wages and salaries climbed 0.2 percent, the smallest gain this year, after 0.6 percent advance in March.
  • U.S. consumer sentiment down in May, wages a concern.
    • The Thomson Reuters/University of Michigan’s final May reading on the overall index on consumer sentiment came in at 81.9, down from 84.1 the month before. It was also below the expectation of 82.5 among economists.
    • Some 56 percent of consumers reported that the economy had improved, up from 49 percent in April.
    • The survey’s barometer of current economic conditions fell to 94.5 from 98.7 in April and below a forecast of 95.8.
    • The gauge of consumer expectations slipped to 73.7 from 74.7 and fell short of an expected 74.0.
  • Business activity in the Chicago area expanded in May for a thirteenth straight month.
    • The Institute for Supply Management (ISM) business barometer rose to 65.5 in May from 63 a month earlier, according to a report today. A reading above than 50 signals expansion.
  • This was supposed to be the year that U.S. mortgage rates soared. Instead, they’re retreating.
    • After five weeks of declines, rates for 30-year fixed loans are at 4.12 percent, the lowest in seven months.
    • The decline in borrowing costs has so far done little to spur sales.
    • The decline in borrowing costs is more likely to spur buyers of cheaper homes, yet more purchases have been of pricier homes.


  • Canada’s economic growth slumped in the first quarter as a harsh winter in North America slowed housing construction, business spending and exports.
    • GDP grew at a 1.2 percent annualized pace in January through March, compared with a downwardly revised 2.7 percent in the prior three months.
    • The Bank of Canada projects the world’s 11th-largest economy will recover in the second quarter and post above-2 percent growth through 2016.
  • Japanese industrial output fell 2.5 percent in April, as companies cut back on production after ramping it up to meet a rush in demand ahead of an increase in the national sales tax from April.
    • The decrease was more than a median market forecast of a 2.0 percent fall.
    • Japan April jobless rate holds steady at 3.6 percent.
  • Brazil’s economic growth slowed in the first quarter.
    • GDP increased 0.2 percent in the first quarter, the equivalent to 0.8 percent on an annual basis.
    • The result was in line with the median estimate of 41 analysts surveyed by Bloomberg. Investment fell 2.1 percent in the quarter.
    • Brazil’s expansion will ease to 1.8 percent in 2014 from a revised 2.4 percent last year, according to the economists’ estimates.
  • Indian GDP grows 4.7% in fiscal year, missing government forecast.
  • Siemens says up to 11,600 jobs at risk in restructuring.
    • Siemens employees 360,000 staff worldwide, with about a third in Germany.


  • Joan of Arcwas burned at the stake as a heretic (1431)
  • King Henry VIII of England married his 3rd wife, Jane Seymour, 11 days after he had his 2nd wife, Anne Boleyn executed (1536)

This information has been prepared from sources believed to be reliable, but no representation is being made as to its accuracy or completeness. The information provided should be used only as general information and is not intended to provide specific advice or recommendations for any individual. The economic forecasts set forth in the material may not develop as predicted. All indices, such as the S & P 500, are unmanaged and may not be invested into directly. Sources: Reuters, Bloomberg.

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