Another week, another round of record highs. Despite concerns about how France’s upcoming presidential election could affect the European Union’s stability, U.S. stocks ended last week up yet again, and markets are on track for the same this week. The S&P 500 gained 1.51%, the Dow added 1.75%, and the NASDAQ increased 1.82% – growth that represents record highs for all three indexes. International equities in the MSCI EAFE also posted positive returns, with 0.78% growth for the week.

Alphavest CEO, Cokie Berenyi at the summit of Mt. Aconcagua

Alphavest CEO, Cokie Berenyi at the summit of Mt. Aconcagua

 

 

As markets and Alphavest models soared to new heights, Alphavest CEO, Cokie Berenyi, also hit an all time high last week as she summited Mt. Aconcagua, the tallest peak in the America’s, at 22,841 feet above sea level.  Mt. Aconcagua, the tallest peak in both North and South America is located in the Andes in Argentina. Congratulations, Cokie!
Model Update, YTD:
It pleases us to report that 100% of our Models are positive, YTD, and positive for the last 12 months ending 1/31/2017.
Most notably, the 2 Models added to the allocation line-up in December, are our best performers; the Alphavest AV Momentum and International Models are ahead of the pack, so far, year-to-date.
The AV Momentum Model is up 8.40% since inception, 12/1/2016, and up 9.97% YTD through 2/23/2017. This proprietary model is using a combination of two leaders in the industry when it comes to stock picking and long-term performance track records, Dorsey Wright and Associates and Zack’s Investment Research. With a combined experience of over 90 years, we are thrilled to have this new addition to our allocations, at no additional cost to you. This model uses 50-100% stocks and minimal ETFs and is based on stock/asset class momentum; investing mostly in a portfolio of stocks that have experienced high price appreciation over the last 52 weeks, that have also experienced a sharp decline over the last week, and that also have a Zacks Rank of 1–indicating a Strong Buy.
With International investments moving their way up the Relative Strength asset scale (from last place as recently as November 2016), we started dipping our toe back into that space in December as the relative strength of international equities was clearly changing for the better after a fall from grace July 2015. The Alphavest International Model is up 8.89% YTD.
Year-to-date the MSCI EAFE (International benchmark) is up 4.36% and the S&P 500 is up 5.54%, as compared to the two highlighted models, above.
A number of data reports also came out last week, and they tell a mostly encouraging story about the economy right now.
JANUARY INCREASES
Consumer Price Index Up by 0.6%
The Consumer Price Index (CPI), which measures the average prices of specific consumer goods and services, beat expectations and experienced its largest month-over-month jump since 2013.[4] The index is now 2.5% higher than a year ago, a sign that inflation could be picking up.[5] 
Producer Price Index Up by 0.6%
Whereas the CPI evaluates price changes from a consumer’s perspective, the Producer Price Index (PPI), measures changes from the seller’s perspective.[6] For January, the PPI also beat expectations, with energy experiencing a 4.7% increase.[7] 
Retail Sales Up by 0.4%
The monthly Retail Sales report shows growth or contraction in consumer demand for goods and can help indicate whether the economy is expanding.[8] In addition to January’s 0.4% growth, the latest report included upward revisions for November and December 2016.[9] Overall, Retail Sales are up 5.6% over January 2016.[10] 
Small Business Optimism Index Up by 0.1 points
Each month, the National Federation of Independent Business (NFIB) releases the results of its Small Business Optimism Index, which shows results from its member surveys.[11] This report measures the mood of small business owners-the largest employers in the U.S.- and January’s results are the highest reading since December 2004.[12] Last month’s growth comes on the back of December’s 7.4 point jump, the survey’s largest ever increase.[13] In other words, small business owners are interested in hiring and expanding, good news for American workers and the economy.[14] 
JANUARY DECREASES
Industrial Production Down by 0.3%
Last month, industrial firms, such as factories and mines, produced a lower volume of raw goods. If you dig deeper, however, the data is likely less concerning than what it may seem at first. For example, warmer-than-normal temperatures in the contiguous U.S. – a factor that does not have to do with the economy – contributed to utility output’s 5.7% decrease, the largest drop since 2006.[15] 
Housing Starts Down by 2.6%
The number of new houses beginning construction fell in January, but future construction permits increased by 4.6% – higher than any time since November 2015.[16] Housing Starts are also up 10.5% over January 2016.[17] While the most recent report shows a monthly dip, the data indicates that housing has grown over the past year and will continue to grow in the future.
As you can gather from the balance between data increases and decreases, the January reports we received last week indicate an economy that is growing. We will continue to monitor the pace of growth and stay on top of political developments as we strive to determine what changes or opportunities may be on the horizon.