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A Macro View: Quality: The Key to Dividend-Paying Stocks
Chart of the Week
- The dollar index moved higher two days in a row, reaching its highest level in two years on Thursday. Despite on-going concerns about US trade relations and increased political tensions, investors continue to view the dollar as a safe haven, as global bond yields remain low.
- Orders for US capital goods, a measure of business investment, declined slightly in August in a number of categories. Machinery orders were up 0.60%, while transportation and electrical equipment declined 0.40% and 1.30%, respectively.
- Peloton (NASDAQ: PTON) made its highly anticipated market debut this week, but faltered as the stock opened $2 below its targeted IPO price of $29. Peloton adds to the list of disappointing IPOs as investors weigh economic and valuation concerns for the newly trading companies.
- US equities experienced some volatility throughout the week, with the S&P 500 Index breaking the 3,000 level on Tuesday but subsequently trending lower. On the domestic front, larger capitalization stocks outperformed small caps, while international developed markets outperformed emerging markets.
- The yield on the 10-Year U.S. Treasury Note decreased slightly over the course of the week, settling at a rate around 1.70%.
- Commodities were generally lower in the week, with oil at the center of investors’ attention. The WTI slipped to its lowest level in a 10-week span as concerns for global demand persisted.
- Consumer confidence rose in September relative to August levels, according to the University of Michigan’s Index for Consumer Sentiment.
- The Personal Consumption Expenditures Price Index (PCE), a Federal Reserve (the Fed) favorite for measuring inflation, rose slightly on a monthly basis and was up 1.80% year over year for August. This reading is below the Fed’s 2% inflation target.
Source: Morningstar, Inc.
Source: Research Affiliates, LLC
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