The Markets

Grinches were few and far between on Wall Street last week as the Dow industrials topped 18,000 for the first time and the S&P 500 also set yet another new record. Even the small caps of the Russell 2000 participated in the merriment, turning in the best performance of the week. The price of the benchmark 10-year Treasury slipped a bit as the yield rose.

Market/Index	2013 Close	Prior Week	As of 12/26	Weekly Change	YTD Change
DJIA	16576.66	17804.80	18053.71	1.40%	8.91%
Nasdaq	4176.59	4765.38	4806.86	.87%	15.09%
S&P 500	1848.36	2070.65	2088.77	.88%	13.01%
Russell 2000	1163.64	1195.96	1215.21	1.61%	4.43%
Global Dow	2484.10	2508.43	2529.85	.85%	1.84%
Fed. Funds	.25%	.25%	.25%	0%	0%
10-year Treasuries	3.04%	2.17%	2.25%	8 bps	-79 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week’s Headlines

• The U.S. economy grew at its fastest pace in 11 years during the third quarter. The Bureau of Economic Analysis said the 5% annualized growth of gross domestic product outpaced Q2’s 4.6% and represented the strongest growth since Q3 2003’s 6.9%. Health care and business investment in buildings and equipment were a large part of the increase. After-tax corporate profits also were up, rising 2.8% from Q2.
• Personal income rose 0.4% in November, but consumer spending rose even more. According to the Commerce Department, consumer expenditures were up 0.6% as falling gas prices left consumers with more money to spend. Meanwhile, disposable income was up 0.5% after adjusting for taxes and inflation.
• Existing home sales slowed a bit in November as the number of homes available for sale fell almost 7%. The National Association of Realtors^® said total sales were down 6.1% for the month, but were 2.1% higher than the previous November. The Commerce Department said new sales of single-family homes also fell 1.6% during the month, and were down 1.6% from a year ago.
• An 8.1% drop in military spending helped cut orders for durable goods 0.7% in November, according to the Commerce Department. It was the third straight month of declines in orders for goods intended to last three years or more. Also, business spending on equipment was basically flat.

Eye on the Week Ahead

As the year winds down in yet another abbreviated week of trading, volumes are likely to continue to be light. A few economic reports are due out, but many traders will be off toasting 2014’s string of record highs and hoping 2015 will bring more of them.