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Weekly Market Update
Week of April 18, 2011
The Markets:

In spite of a rocky start to earnings season, promising economic news helped reassure investors this week. Stocks even managed to post modest gains on Friday in response to the hopeful signs.


Aside from food and gas prices, the Labor Department reported that consumer prices rose just 0.1% in March, lower than the predicted 0.2%.[1]  With prices inflating slower than expected, Americans got a break. And in today's economy, consumers need every break they can get. When prices are lower, people tend to feel better and spend more - good news since consumer spending accounts for about 70% of the total U.S. economy.[2]


Signs show that Americans are also feeling more optimistic. The U.S. consumer sentiment index rose from 67.5 in March to 69.6 in April, beating expectations.[3]  This increase could be partially attributed to the addition of jobs for six straight months and an unemployment rate sitting at a two-year low.[4]  These positive numbers indicate job gains are helping Americans manage rising fuel costs and maintain a positive outlook.[5]


Industrial production increased for the ninth straight month in a row, rising 0.8% in March, and factory production increased 9.1% in the first quarter.[6]  Total industrial production was 5.9% above its year-earlier level.[7]  These numbers are all higher than forecast last month, and are a good sign that factories will keep driving the U.S. economy.[8]

These indicators show that prices are down, optimism is up, and factories are producing at higher levels than last year; all signs that our economy is still making progress. Earnings season will kick into high gear this week as Wall Street gets quarterly results from 110 members of the S&P 500, giving us a broad view of how Corporate America is doing.

ECONOMIC CALENDAR:                                          
Monday - Housing Market Index                                           
Tuesday - Housing Starts, Redbook                             
Wednesday - Existing Home Sales, EIA Petroleum Status Report
Thursday - Jobless Claims, Philadelphia Fed Survey, Leading Indicators                                  Friday - U.S. Market Holiday: Good Friday Observed       



Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized.
Sources: Yahoo! Finance, MSCI Barra. Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. NA means not available.


Congress sent President Barack Obama legislation cutting a record $38 billion from federal spending on Thursday.  This measure will finance the government through the September 30th end of the budget year.[9]


Bank of America's first-quarter income fell 39% on higher costs related to its mortgage business and litigation. The bank also settled a claim over faulty mortgage investments and set aside less money to cover bad loans. The earnings fell short of the 28 cents a share estimated by analysts surveyed by FactSet and revenue fell to $26.9 billion from $32 billion in the same period last year.[10] 


The first settlement with the Securities and Exchange Commission (SEC) could be reached as soon as next week.  The securities regulator is in talks with major Wall Street banks to settle fraud allegations relating to the sale of toxic mortgage bonds to various investors that helped unleash the financial crisis.[11]

Quote of the Week
It is hard to fail, but it is worse never to have tried to succeed. - Theodore Roosevelt
Recipe of the Week

Goat Cheese Pastry Rounds


From: Better Homes and Gardens

1/2 of a 17.3-ounce package frozen puff pastry (1 sheet), thawed
Tomato preserves or favorite fruit preserves* (about 3 tablespoons)
3 2- to 2-1/2-inch diameter rounds goat cheese (3 to 4 oz. each)
1 egg, beaten   
Fresh figs or grapes (optional)

1. Preheat oven to 400 degree F. Line a baking sheet with foil; grease foil. Set aside.

2. Unfold pastry on a lightly floured surface; roll into a 12-inch square. Cut pastry into four 6-inch squares. Place 1 tablespoon preserves in center of 3 of the pastry squares. Place goat cheese atop preserves. Bring edges of pastry up and over cheese rounds, pleating and pinching edges to cover. Sea; trim excess pastry. Invert and place on prepared baking sheet, smooth side up. Brush pastry with egg. Cut small slits in pastry for steam to escape. Cut remaining pastry square into decorative leaves; place atop brushed pastry and brush with additional egg.

3. Bake for 20 to 22 minutes or until pastry is golden brown. Let stand 15 to 20 minutes before serving. If desired, serve with fresh figs. Makes 12 servings.

Golf Tip of the Week
What the Perfect Swing Looks Like

By Michael Lopuszynski 

The Problem:
You're hitting too many slices and your swing just never feels right.

The Solution:

Most of us are taught to swing down the target line, which actually causes your arms to fly away from your body. The result is inconsistent contact and a swing you can't repeat. The only time your clubface should point down the target line is when you contact the ball. The swing path should start inside and intersect the target line only just before impact and then start back inside right after impact. This circular swing keeps your body and arms connected, which helps you strike the ball with power.

Try This:

On the range, stop your arms at impact and allow your body rotation to bring the club back inside on your follow-through. This will ingrain the proper clubhead path after impact.

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The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.


The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.


The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.


The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.


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Pat Webb
Pat Webb - Phase 2 Advisors
8100 Turman Ct
Fort Collins, CO 80525