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Investing Specialists

Deflation Hides the Growth in Consumer Spending

After deflation adjustments, the retail sales data was quite positive, at least for consumers.

We can actually say it was a good week for just about all markets, although they remained a lot more volatile than we all would like. Weekly equity returns ranged from 1.4% in the U.S. to 3.1% for emerging markets. Even commodities had a great week, with the broad index up 2.8%.

Oil had a massive rebound on Thursday and Friday, gaining almost 10% during those days. We couldn't see any potential catalysts, except oil had fallen too far and the sellers got tired of selling. While the oil news almost seemed bad to us, the market took great solace on finding a bottom, maybe. The best performers this week were the worst-performing items in the previous week. For 2016, the major U.S. equity markets have lost between 6% and 8%.