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Treasuries rallied, the dollar and equities fell after data showing stalling retail sales and a benign PPI.  All added to speculation that the Federal Reserve will be in rush to raise interest rates this year.  Gold and oil advanced.

The final two weeks of summer typically are the slowest times on Wall Street.  As noted last week, the S & P has now gone 25 consecutive days without moving 1% in either direction, the longest stretch since 2014.  Will this streak be extended to 39 days given the historical seasonal lethargy?

Have all become too complacent or does the averages mask the underlying inter day volatility and violence in other markets?  I believe the latter using oil as an example.  Crude fell about 22% and then rallied about 15% from lows posted about 10 days ago.

What will happen this week?  The economic calendar consists of several housing statistics, the CPI and LEI, Capacity Utilization/Industrial Production, as well as the Minutes from the July FOMC meeting.  How will these releases influence perception?

Last night the foreign markets were up.  London was up 0.25%, Paris up 0.06%, and Frankfurt 0.32%.  China was up 2.51%, Japan down 0.03%, and Hang Sang up 0.73%.

The Dow should open little changed.   The 10-year is unchanged at 1.52%.

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Ken Engelke

Chief Economic Strategist Managing Director

The views expressed herein are those of Kent Engelke and do not necessarily reflect those of Capitol Securities Management. Any opinions expressed are statements of judgment on this date and are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated or projected. Any future dividends, interest, yields and event dates listed may be subject to change. An investor cannot invest in an index, and its returns are not indicative of the performance of any specific investment. Past performance is not indicative of future results. This material is being provided for informational purposes only. Any information should not be deemed a recommendation to buy, hold or sell any security. Certain information has been obtained from third-party sources we consider reliable, but we do not guarantee that such information is accurate or complete. This report is not a complete description of the securities, markets, or developments referred to in this material and does not include all available data necessary for making an investment decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. If you would like to unsubscribe from this e-mail distribution, please reply to this e-mail and indicate that you wish to unsubscribe in your response.