MARKETS RALLY ON BOLD EU PROPOSAL
Last week, European leaders crafted a new plan to help the continent’s beleaguered banks: eurozone rescue funds would be used to directly recapitalize troubled lenders, without contributing to existing sovereign debt. A single supervisory body would also be created to serve as a banking watchdog. Key details need to be ironed out, but Wall Street loved the news – the Dow gained 278 points Friday.1   

HEALTH CARE REFORMS (LARGELY) STAND
In a 5-4 vote last week, the Supreme Court upheld the individual insurance mandate within 2010’s Affordable Care Act. In the majority opinion, Chief Justice John G. Roberts, Jr. characterized the mandate as a tax permitted under the Constitution. The high court did rule that the law’s expansion of Medicaid violated states’ rights.2

ENCOURAGING DEVELOPMENTS IN REAL ESTATE
The National Association of Realtors said that its pending home sales index rose 5.6% in May to 101.1 – the highest level in two years, and a number characteristic of a “healthy” residential real estate market. New home sales rose 7.6% in May to a pace unseen since April 2010, the Census Bureau noted. Freddie Mac said average interest rates on conventional home loans hit a new low last week at 3.66%.3 

NO GAINS IN CONSUMER SPENDING OR CONFIDENCE
Personal spending was flat in May, and the Commerce Department revised April’s gain to just 0.1%. The Conference Board’s June consumer confidence survey fell to 62.0 from May’s revised 64.4 reading; June’s final University of Michigan consumer sentiment survey dropped down to 73.2 from May’s final 79.3 mark.4,5

OIL, GOLD, EQUITIES ALL RISE
Friday, the S&P 500 (1,362.16), NASDAQ (2,935.05) and DJIA (12,880.09) all settled at highs unseen since May 8. For the week, the Dow gained 1.89%, the S&P 2.03% and the NASDAQ 1.47%. Oil settled Friday in New York at $84.96 a barrel, leaping $7.27 in a day; gold jumped $53.80 to close the week at $1,604.20 an ounce on the COMEX.1,6

THIS WEEK: Monday, the Institute for Supply Management presents its June manufacturing index; May construction spending data will also appear. Tuesday, the federal government issues reports on May factory output and June auto sales; the NYSE closes early. Wednesday is July 4, and U.S. equity and bond markets will be closed. ISM’s June non-manufacturing index and the latest weekly jobless claims numbers come out on Thursday. The June unemployment report arrives Friday.

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+5.42

+5.05

-0.79

+3.93

NASDAQ

+12.66

+7.10

+2.55

+10.06

S&P 500

+8.31

+4.19

-1.88

+3.76

REAL YIELD

6/29 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

-0.46%

0.74%

2.65%

3.48%

Sources: money.msn.com, bigcharts.com, treasury.gov, treasurydirect.gov – 6/29/121,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.

Jeffrey Foster is a Registered Representative with, and securities are offered through LPL Financial, Member FINRA/SIPC.

This material was prepared by MarketingLibrary.Net Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. Marketing Library.Net Inc. is not affiliated with any broker or brokerage firm that may be providing this information to you. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Citations.

1 – money.msn.com/market-news/post.aspx?post=95f998bd-6fbe-4de1-9b51-8cb1f437973a [6/29/12]
2 – www.latimes.com/news/politics/la-pn-justice-roberts-leads-supreme-court-support-of-healthcare-law-20120628,0,3606595.story [6/28/12]
3 – www.mercurynews.com/business/ci_20963751/look-at-us-housing-market-at-glance [6/28/12]
4 – www.reuters.com/article/2012/06/29/usa-economy-idUSL2E8HT2ZG20120629 [6/29/12]
5 – briefing.com/investor/calendars/economic/2012/06/25-29 [6/29/12]
6 – montoyaregistry.com/Financial-Market.aspx?financial-market=common-financial-mistakes-and-how-to-avoid-them&category=29 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F29%2F11&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F29%2F11&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F29%2F11&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F29%2F07&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F29%2F07&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F29%2F07&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F28%2F02&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F28%2F02&x=0&y=0 [6/29/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F28%2F02&x=0&y=0 [6/29/12]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [6/29/12]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [6/29/12]
9 – treasurydirect.gov/instit/annceresult/press/preanre/2002/ofm10902.pdf [1/9/02]