AdvisorShares Weekly Market Review – Week Ending 10/11/13
Highlights of the Prior week
For the week of October 7 – October 11
The markets were volatile last week. The major benchmarks, with the exception of the Nasdaq went up. As in the previous weeks, political developments drove the markets. The markets declined until Wednesday due to the ongoing government shutdown. On Wednesday, the markets reacted favorable when President Obama and the House Republicans agreed to meet. Also on Wednesday, Alcoa was the first major American company to report earnings, which were positive. Wells Fargo and JP Morgan also reported earnings. Thursday was the best day in two years for the large-cap benchmarks, based on news of a Republican plan to extend the debt ceiling for another six weeks. On Wednesday, Obama nominated Janet Yellen to be the next Chair of the Fed. She is thought to be more dovish than Ben Bernanke. In terms of economic statistics, consumer sentiment decreased in October, the NFIB Small business optimism index fell and jobless claims increased to 374,000.
Due to fears about hitting the debt ceiling, Treasury bonds maturing this month dropped in price. However, on the good news on Thursday caused bonds to increase in price. High yield corporate debt has been performing well, despite the political situation. Municipal bonds fell a little bit, and the state of Massachusetts decided to investigate money managers who are alleged to have misled investors about their holdings in troubled Puerto Rican debt. Emerging market debt performed well, especially after Thursday. Brazil raised interest rates again and India’s current account deficit contracted.Sources: *Indexes are from Reuters and Yahoo! Finance 4pm closing data *Gold prices are from EcoWin and J.P. Morgan Asset Management *Treasury rates are from Bloomberg.com *Municipal and high yield rates are from Barclays Capital
Past performance is not indicative of future results.