Risky Business or Business as Usual?

We have a big week for economic data with the emphasis on employment. With reports on jobless claims, ADP employment, and the official employment situation report all hitting right before Labor Day, we can be sure it will be a big topic. Throw in the election campaigning and we can expect jobs to be the theme of the week. For many it will also mean the end of vacation, returning to work after a layoff, or the reopening of a business. There is a key question however:

Will it be Risky Business or Business as Usual?

(Mrs. OldProf enjoyed listening to Bob Seger as I searched for this image. The song is now the #2 Jukebox Single of all time).

Last Week Recap

In my last installment of WTWA, I highlighted the changes in the housing market and suggested an investment opportunity. The subsequent data have helped to keep this a hot topic. Home building stocks remain among my favorites, partly because of the underlying demographic dynamics.

The Story in One Chart

I always start my personal review of the week by looking at a great chart. This week I am featuring Jill Mislinski’s version, which captures many important features with a single glance.

Jill always has many great charts in this weekly update post. For a longer perspective here is one that shows the market path since 2007, highlighting the various drawdowns.

The market gained 3.3% on the week with an intra-week trading range of only 2.8%. My weekly indicator snapshot monitors the actual (low) volatility as well as the VIX (see below).

The weekly sector chart shows the sources of the action.