weekof070708

Quote of the week. “No one can make you feel inferior without your consent.” – Eleanor Roosevelt

Unemployment stays flat at 5.5%. That was (relatively) good news for Wall Street, which had feared an increase. The Labor Department reported 62,000 fewer jobs in June, about in line with economists’ median forecasts.¹

Service sector contracts. This was (unexpectedly) bad news for Wall Street. The Institute for Supply Manufacturing’s May index posted a 48.2 reading for June, notably down from 51.2 in May. (A reading below 50 indicates contraction.) The median forecast of economists polled: 51.0.²

Oil settles at $145. Friday, crude oil closed at $145.29 per barrel on the New York Mercantile Exchange, down from $145.85 in intraday trading. Oil futures gained Friday with news of increased demand in China for reconstruction efforts in the wake of the May earthquake in Sichuan Province.³

ECB raises rates, dollar gains. The European Central Bank raised its benchmark interest rate by 25 basis points to 4.25%, but assumptions that the ECB will refrain from further rate hikes sent the euro dropping and bolstered the dollar last week. The dollar traded at 106.75 yen Friday (a 0.8% gain), and the euro fell 1.1% versus the dollar.⁴

Short subpar week. The Dow, NASDAQ and S&P 500 lost some ground during an abbreviated trading week; the NASDAQ was hit the hardest, sliding 3%, while the Dow only lost 0.5%.⁵

% Change	Y-T-D	1-Year	5-Yr Avg
DJIA	-14.90	-20.28	+4.89
NASDAQ	-15.34	-17.80	+7.00
S&P 500	-13.99	-20.74	+5.62

(Source: CNBC.com, CNNMoney.com, 7/3/08) ^{5, 6}

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.

Riddle of the week. A farmer feeds a total of ten goats and dogs with 56 biscuits. The dogs each eat six biscuits and the goats each eat five biscuits. So how many goats and how many dogs does he have?

Contact my office or see next week’s Update for the answer.

Last week’s riddle: How can you be behind your brother when he is behind you?

Answer: By standing back to back.

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These views are those of Peter Montoya Inc., and not of Gary Hokin and/or Nikoh Securities Corporation, and should not be construed as investment advice.

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. 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. The 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 other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult Gary Hokin at (847) 559-1002 for further information. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards.

Citations. ¹ msnbc.msn.com/id/25510193/ [7/3/08]

² msnbc.msn.com/id/25513879/ [7/3/08]

³ bloomberg.com/apps/news?pid=20601012&sid=a9BZ55pFTT1w&refer=commodities [7/3/08]

⁴ bloomberg.com/apps/news?pid=20601103&sid=aK6NUxFtPWHI&refer=news [7/3/08]

⁵ cnbc.com/id/25411508 [6/27/08]

⁶ money.cnn.com/quote/historical/historical.html?pg=hi&close_date=7%2F3%2F07&mode=add&symb=DJIA [7/3/08]

⁶ money.cnn.com/quote/historical/historical.html?pg=hi&close_date=7%2F3%2F03&mode=add&symb=DJIA [7/3/08]

⁶ money.cnn.com/quote/historical/historical.html?pg=hi&close_date=7%2F3%9F07&mode=add&symb=NASDAQ [7/3/08]

⁶ money.cnn.com/quote/historical/historical.html?pg=hi&close_date=7%2F3%2F03&mode=add&symb=NASDAQ [7/3/08]

⁶ money.cnn.com/quote/historical/historical.html?pg=hi&close_date=7%2F3%2F07&mode=add&symb=SPX [7/3/08]

⁶ money.cnn.com/quote/historical/historical.html?pg=hi&close_date=7%2F3%2F03&mode=add&symb=SPX [7/3/08]