This Weekly Financial Markets Update reviews the top market headlines: Retail Sales Increase Again in September, Existing Home Sales Continue to Fall, Leading Indicators Register 18th Straight Decline
  • Retail sales rose 0.7% in September from the prior month
  • U.S. existing home sales in September were 8% lower than the prior year
  • The Leading Economic Index fell by 0.7% in August

Top Three Market Headlines

Retail Sales Increase Again in September: Sales at U.S. retail and food service establishments in September rose 0.7% versus the prior month and 3.8% over the prior year, the U.S. Department of Commerce reported last week. At the same time, the previously reported monthly growth rate for August was revised up from 0.6% to 0.8%. This was the sixth consecutive monthly sales advance, and the 3.8% annual rate was the highest pace since February of this year. The reported rise in September was fairly widespread across various kind of businesses, withy particular strength in online sales and restaurants, where sales rose 1.1% and 0.9%, respectively, over the prior month.

Existing Home Sales Continue to Fall: Sales of existing homes in the U.S. fell for the fourth straight month in September, decreasing 2.0% from the prior month, according to a report last week from the National Association of Realtors. The seasonally-adjusted annualized rate (SAAR) of 3.96 million home sales was the slowest monthly sales pace since October 2010 and was 15% below the level recorded in September of last year. The year-over-year rate of sales has now declined each month for over two years. The continued downtrend reflects the impact of rising mortgage rates on affordability and limited housing inventory.

Leading Indicators Register 18th Straight Decline: The Conference Board reported last week that its Leading Economic Index (LEI), a composite of ten U.S. economic indicators intended to signal turning points in the economy, fell by 0.7% in September from the prior month. The index has now fallen for 18 straight months, indicating a risk of economic weakness ahead. The latest decline was primarily attributed to weakness in new orders, deteriorating consumer sentiment, higher interest rates, and lower building permits. Based on the index's latest reading, the Conference Board forecasts that the U.S. economy's resilience "will not be sustained for much longer, and a shallow recession is likely in the first half of 2024."

As of October 23, 2023 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World -2.49% -2.20% 7.63% 16.05%
S&P 500 -2.38% -1.42% 11.47% 17.18%
Russell 2000 -2.25% -5.80% -3.40% 0.18%
MSCI EAFE -2.59% -3.46% 3.37% 18.64%
MSCI Emerging Markets -2.70% -2.82% -1.05% 9.90%
FTSE NAREIT -3.72% -3.99% -6.05% 0.74%
Bloomberg Commodity 0.61% 1.25% -2.24% -0.23%
Barclays U.S. Aggregate -1.73% -1.95% -3.13% 1.25%
NAR 10/19/2023, Reuters 10/17/2023, US Dept. of Commerce 10/17/2023, The Conference Board 10/19/2023, FactSet. Data from Morningstar Direct. Returns for periods greater than one year are annualized. Gallagher Fiduciary Advisors, LLC ("GFA") is an SEC Registered Investment Adviser that provides retirement, investment advisory, discretionary/named and independent fiduciary services. GFA is a limited liability company with Gallagher Benefit Services, Inc. as its single member. GFA may pay referral fees or other remuneration to employees of AJG or its affiliates or to independent contractors; such payments do not change our fee. Securities may be offered through Triad Advisors, LLC ("Triad"), member FINRA/SIPC. Triad is separately owned and other entities and/or marketing names, products or services referenced here are independent of Triad. Neither Triad, Arthur J. Gallagher & Co., GFA, their affiliates nor representatives provide accounting, legal or tax advice.