Will It Be Five Weeks In A Row Of Gains?

The markets ended modestly lower yesterday, but remain near their all-time highs.

Lending support to the market was yesterday's Weekly Jobless Claims which fell by 15,000 to 243,000, beating last month's 258K and views for 252K.

The Producer Price Index-Final Demand report was also supportive with the m/m change at 0.4%. On a y/y basis we were up 2.6%. Analysts pointed to a spike in energy prices as having a larger impact on the numbers. And you can see that in the snapshot that excludes food & energy as that y/y rate of change came in at a more moderate 2.2%. But both sets of numbers show a slow and steady uptrend in inflation, which is what the Fed wants to see for a healthy economy.

Later today we'll get the Consumer Price Index report, Retail Sales, Business Inventories, and Consumer Sentiment. I expect these reports to also underscore the strength in the economy.

Most of the major indexes are within striking distance of making it five weeks in a row of weekly gains. And it won't take much to get there.

I'm not surprised at this at all. As you know, I'm expecting at least 2,600 in the S&P by year's end. But at this pace, I think we can get even higher.

These are historic times.

Best,

Kevin Matras

Executive Vice President, Zacks Investment Research

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