The Dow closed the trading session on Friday with a 123-point gain on heavier trading volume to close at 25,413. For the week, the Dow lost about 2.3% after gaining 2.8% the prior week. BTS indicators have sung back to positive and “Dan the man” said the indicators revealed solid investor support for assets at levels seen about three weeks ago when markets bottomed.
Walmart reported earnings that beat both top and bottom lines and even though the company raised its forward guidance shares traded lower in sympathy with a broader selloff in retail stocks. Walmart had a 1% revenue gain and an 8% increase in net income. The company saw 43% growth in its online segment and is now the third largest e-commerce retailer in the US behind Amazon and Ebay. The selloff is retail stocks was due to concern about margins being pinched by online retail sales. Overall retail sales are up 5.6% over the past year and the most recent report indicated a pickup in spending. The gurus are expecting a record Christmas Holiday shopping season, but e-commerce should be the big winner over brick and mortar.
The Puget Sound Business Journal had an article about why the housing market has gone soft while the overall economy has continued to motor along. While some feel the softness in housing could be a sign of a potential economic slowdown, the article noted that it is more likely the result of affordability because while housing prices in the US have risen by 48% since 2011, per capita income has only risen 25%. Add to that the rise in interest rates, land and labor costs and you can see how the housing markets could be slow until affordability improves.
The Boy Scouts are gearing up for our annual Christmas Tree sale. This weekend we will pick up a load of wreaths, garland and swags. Next weekend we will set up our tree lot in the parking lot of St. Alphonsus Church in Ballard and we will be off to the races. We were able to get a good number of trees this year, but the species mix is not as good. Grand firs are in short supply as are Norway Spruce. The latest trend in Christmas tree technology is the Nordman Fir. It is native to the Ukraine but growers in the Northwest like them as do customers. Noble firs are the clear favorite and we have plenty of those.