11 12, 2018

Weekly Market Commentary – Two issues which helped push down major U.S. stock indices lower

2018-12-12T20:15:24+00:00 December 11th, 2018|Weekly Market Commentary|

The Markets We’re off to a slow start. December is usually the best month of the year for the stock market. It has been since 1950, according to Randall Forsyth of Barron’s, but not so far this year. Two issues made investors particularly uncomfortable last week which helped trigger a sell-off that pushed major U.S. stock indices lower. Fading optimism about an easing of trade tensions with China. It looked like the relationship between the United States and China might thaw, and Americans were feeling pretty optimistic about a trade truce. In fact, markets moved higher Monday in anticipation. [...]

21 11, 2018

Weekly Market Commentary – A remedy for the Market’s motion sickness

2018-11-21T19:49:35+00:00 November 21st, 2018|Weekly Market Commentary|

The Markets Keep your eyes on the horizon. Motion sickness happens when your body receives conflicting signals from your eyes, ears, and other body parts. One way to manage the anxiety and queasiness that accompany the condition is by keeping your eyes on the horizon. The motion of the stock markets has been causing some investors to experience similar symptoms. Surprisingly, the remedy is the same: Keep your eyes on the horizon – your financial planning horizon. A planning horizon is the length of time over which an investor would like to achieve his or her financial goals. For [...]

14 11, 2018

Weekly Market Commentary – Gauging Investor Sentiment and Unicorns vs Zebras

2018-11-14T19:57:04+00:00 November 14th, 2018|Weekly Market Commentary|

The Markets How are you feeling about financial markets? Some votes are still being counted but investors appear to be happy with the outcome of mid-term elections. Major U.S. stock indices in the United States moved higher last week, and the American Association of Individual Investors (AAII) Sentiment Survey reported: “Optimism among individual investors about the short-term direction of stock prices is above average for just the second time in nine weeks…Bullish sentiment, expectations that stock prices will rise over the next six months, rose 3.4 percentage points to 41.3 percent. This is a five-week high. The historical average [...]

31 10, 2018

Weekly Market Commentary – Why did the stock market fall when the economy is doing well?

2018-11-01T05:30:37+00:00 October 31st, 2018|Weekly Market Commentary|

The Markets Why did the stock market fall when the economy is doing well? The answer is that one reflects the past and the other anticipates the future. Last Friday’s advance estimate from the Bureau of Economic Analysis showed the U.S. economy grew 3.5 percent during the third quarter of 2018. Harriet Torry of The Wall Street Journal reported: “The economy powered ahead in the third quarter, driven by robust consumer and government spending, though Friday’s report included warning signs that the business sector faces turbulence that could hold back the expansion in the months ahead.” Third quarter’s economic [...]

23 10, 2018

Weekly Market Commentary – the end of synchronized global growth?

2018-10-23T16:40:50+00:00 October 23rd, 2018|Weekly Market Commentary|

The Markets The world remains full of opportunities and challenges. Although we’ve seen global markets moving in tandem in recent years, Sara Potter of FactSet pointed out, “…we’re starting to see the end of the synchronized global growth that has prevailed over the last two years. While the U.S. economy remains strong, growth in Europe and Japan is moderating, and emerging markets are under increasing economic and financial market pressure.” Strong economic growth and robust earnings helped U.S. stocks significantly outperform other regions of the world during the third quarter of 2018. In addition, the resolution of some trade [...]

9 10, 2018

Weekly Market Commentary – The stock market tends to be a leading economic indicator

2018-10-09T20:52:02+00:00 October 9th, 2018|Weekly Market Commentary|

The Markets The stock market tends to be a leading economic indicator. Last week offered some insight to economics and stock market behavior. The U.S. unemployment rate reached its lowest level since 1969 and wages moved higher, yet major U.S. stock indices lost value. Why didn’t stock markets move higher? The answer is stock prices tend to be leading indicators. They reflect investors’ expectations for the future. Last week, investors may have been thinking like this: When unemployment is low, companies cannot always hire enough workers… To hire more workers, companies raise wages… Higher wages give workers more spendable [...]

2 10, 2018

Weekly Market Commentary – The Federal Reserve and the word “accommodative”

2018-10-02T17:34:12+00:00 October 2nd, 2018|Weekly Market Commentary|

The Markets It wasn’t headline news… But, if newsprint was still popular, last week’s key economic news would have appeared below the fold. The Federal Reserve raised rates for the third time in 2018, as expected. In addition, the Federal Open Market Committee projects economic growth will continue for three more years, although its median numbers show growth slowing from 3.1 percent in 2018 to 1.8 percent in 2021. (Remember, forecasts, no matter how venerable the source, are best guesses and not bedrock.) Investors weren’t enthusiastic about the Fed’s actions or its expectations, and the onset of United States-China [...]

26 09, 2018

Weekly Market Commentary – Economy in late stages of expansion?

2018-09-26T18:14:50+00:00 September 26th, 2018|Weekly Market Commentary|

The Markets Did you hear the news? A tech company introduced a microwave you can turn on using Wi-Fi – as long as you have one of the company’s voice assistants at home, reported Kaitlyn Tiffany of Vox. Soon, the voice assistants will be built with neural networks that will formulate hunches about whether their owners might like to be reminded to lock the door or turn off a device. Some people love the idea. Others don’t. Internet-enabled appliances weren’t the only show in town last week. The strong performance of the U.S. economy earned a standing ovation from [...]

18 09, 2018

Weekly Market Commentary – Investors or Consumers?

2018-09-18T20:01:06+00:00 September 18th, 2018|Weekly Market Commentary|

The MarketsAll investors are consumers, but not all consumers are investors.The September installment of University of Michigan’s Consumer Sentiment Survey reported Americans are feeling pretty optimistic. Consumer sentiment rose to the second highest level since 2004, and consumer expectations reached the highest level since 2004. Surveys of Consumers chief economist, Richard Curtin, wrote:“Consumers anticipated continued growth in the economy that would produce more jobs and an even lower unemployment rate during the year ahead…The largest problem cited on the economic horizon involved the anticipated negative impact from tariffs. Concerns about the negative impact of tariffs on the domestic economy were [...]

12 09, 2018

Weekly Market Commentary – Remember: Volatility is normal

2018-09-12T21:03:10+00:00 September 12th, 2018|Weekly Market Commentary|

The Markets Remember: Volatility is normal. Major U.S. stock market indices climbed into record territory during August. They gave back some gains last week. Peter Wells of Financial Times explained: “Speculation about a fresh round of tariffs on Chinese imports from the Trump administration weighed on U.S. stocks, handing the S&P 500 its first four-day losing streak in a month. A strong jobs report only hardened expectations that the Federal Reserve views the U.S. economy as healthy enough to withstand a probable interest rate rise later this month.” Strong economic growth and rising wages have the potential to push [...]