Weekly Update

post from Brighton Perspective on 16 November 2009 09:42:00 AM. © Brighton Perspective

The Markets

The equity rally continued last week as all major equity indexes posted gains. Continued dollar weakness helped the equity markets as it countered weaker than expected consumer confidence and a larger than expected budget deficit for October. 10 year Treasury yields declined slightly as the Fed signaled it will hold the Fed Funds rate steady in the near term and the latest consumer confidence report highlighted continued weakness. Less consumer spending reduces the near-term risks of inflation.

Market/Index

2008 Close

Prior Week

As of 11/13/09

Week Change

YTD Change

DJIA

8776.39

10023.42

10270.47

2.46%

17.02%

S&P 500

903.25

1069.30

1093.48

2.26%

21.06%

MSCI World

920.226

1132.192

1158.258

2.30%

25.87%

Russell 2000

499.45

580.35

586.26

1.02%

18.95%

Fed. Funds

.25%

0 bps

10-year Treasuries

2.24%

3.54%

3.45%

(9) bps

121 bps

Last Week's Headlines

· G-20 leaders pledged to keep aid flowing to support the global economic recovery

· Consumer confidence was weaker than expected

· October budget deficit was larger than expected

· Strong demand for Treasuries demonstrated the U.S. can still borrow at low rates

Upcoming Items of Interest

The dollar will continue to be a focal point for investors as weakness would support higher equity prices. Also on the docket for the week are retail sales, Industrial production, CPI and housing data (housing starts and existing home sales). Investors will be searching for signs of continued economic recovery with little prospect of inflation. If the data reported this week is stronger than expected, it will lend support to bullish investors expectations of the economic recovery. However, if the data is weaker than expected an overriding question will be ? can equity markets continue to move higher on dollar weakness alone?

Data source: All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Headlines and upcoming items of interest are pulled from published reports of Briefing.com and Reuters. Past performance is no guarantee of future results. The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2000 U.S. small-cap common stocks. The MSCI World Index is a free-float adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets.