PRICES RISE MOST IN TEN MONTHS
Consumer prices were up 0.4% in February according to the Commerce Department, yet core inflation rose only 0.1%. A 6% jump in gasoline prices represented 80% of the Consumer Price Index’s biggest gain since April, while food prices were flat for the first time since July 2010. Economists polled by Bloomberg expected a 0.5% rise in CPI for the month. Producer prices also rose 0.4% last month, but prices for finished products were up but 0.1%. Annualized inflation was at 2.9% in February; annualized core CPI was at 2.2%.1,2

AN ILLUMINATING STATESIDE STRESS TEST
Applying a hypothetical “doomsday” scenario of the Dow losing half of its value, joblessness at 13% and home prices at 1996 levels, the Federal Reserve put 19 major U.S. banks through its annual stress test last week and found that 15 passed: American Express, Bank of America, Bank of New York Mellon, BB&T, CapitalOne, Fifth Third, Goldman Sachs, JP Morgan Chase, Keycorp, Morgan Stanley, PNC, Regions, State Street, U.S. Bancorp and Wells Fargo. Four lenders did not pass – the Fed concluded that Citigroup, SunTrust, Ally and MetLife would lose enough assets under the stress test scenario to pose systemic risk.3

CONSUMERS BUY MORE, SHOW LESS CONFIDENCE
The Census Bureau noted a 1.1% rise in retail sales for February and revised the January gain north to 0.6%. Elsewhere, the initial University of Michigan consumer sentiment survey for March showed a slight dip to 74.3 from 75.3 in late February.4,5

BEST WEEK FOR U.S. EQUITIES SINCE DECEMBER
The NASDAQ? It went +2.24% on the week to settle Friday at 3,055.26. The Dow? Up 2.40% in five days to end the week at 13,232.62. The S&P 500? +2.43% to 1,404.17 at Friday’s close. More good news: the CBOE VIX settled below 15 Friday after touching a 5-year low. Crude oil was down 0.32% for the week to $107.06, gold down 3.25% last week to $1,655.80.2,6

THIS WEEK: Monday, Adobe Systems issues Q4 results. Tuesday, February housing starts figures complement earnings from Tiffany, Krispy Kreme, Oracle and Cintas, and Fed chairman Ben Bernanke speaks at George Washington University. Wednesday, existing home sales figures are out for February as well as Q4 earnings from General Mills and Discover Financial. Thursday brings around round of initial claims, the Conference Board’s February leading indicators index and earnings from Nike, FedEx, Dollar General, Accenture and GameStop. Friday, we get data on February new home sales plus earnings from Darden Restaurants and KB Home.

% CHANGE

Y-T-D

1-YR CHG

5-YR AVG

10-YR AVG

DJIA

+8.31

+13.94

+1.85

+2.47

NASDAQ

+17.28

+16.75

+5.75

+6.35

S&P 500

+11.65

+11.72

+0.25

+2.04

REAL YIELD

3/16 RATE

1 YR AGO

5 YRS AGO

10 YRS AGO

10 YR TIPS

-0.09%

0.85%

2.16%

3.48%

Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov – 3/16/126,7,8,9
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 – www.usatoday.com/money/economy/story/2012-03-16/February-inflation-consumer-price-index/53561880/1 [3/16/12]
2 – money.msn.com/market-news/post.aspx?post=7b65a645-53f2-4b26-8b37-7c9c88448197 [3/16/12]
3 – www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2012/03/16/investopedia77515.DTL [3/16/12]
4 – www.census.gov/retail/marts/www/marts_current.pdf [3/13/12]
5 – montoyaregistry.com/Financial-Market.aspx?financial-market=common-financial-mistakes-and-how-to-avoid-them&category=29 [3/16/12]
6 – www.cnbc.com/id/46758651 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F16%2F11&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F16%2F11&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F16%2F11&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F16%2F07&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F16%2F07&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F16%2F07&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=3%2F15%2F02&x=0&y=0 [3/16/12Z7 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=3%2F15%2F02&x=0&y=0 [3/16/12]
7 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=3%2F15%2F02&x=0&y=0 [3/16/12]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [3/16/12]
8 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [3/16/12]
9 – treasurydirect.gov/instit/annceresult/press/preanre/2002/ofm10902.pdf [1/9/02]