Weekly Update

The Weekly Update

Week of February 20, 2018
By Christopher T. Much, CFP®, AIF®

Markets rebounded last week, posting sizable gains and moving back into positive territory for the year. All three domestic indexes experienced their largest weekly growth in years, despite losing some ground on Friday after news of additional indictments in the Russia investigation.

By markets’ close on February 16, the S&P 500 added 4.30%, the Dow was up 4.25%, and the NASDAQ increased 5.31%. International stocks in the MSCI EAFE also gained 4.18% for the week.

This performance, however, did not come from simple, straightforward increases. Instead, the volatility from recent weeks continued. In fact, the S&P 500 lost or gained at least 1% on 8 of the past 10 trading days. The index only experienced that movement level 8 times throughout 2017.

Key Economic Findings

We received a wealth of data last week, and the readings helped deepen our understanding of …

The Weekly Update

Week of February 12, 2018
By Christopher T. Much, CFP®, AIF®

After months of relative calm, market fluctuations are causing many investors to wonder what is happening to the economy. Last week, the S&P 500 lost 5.16%, the Dow dropped 5.21%, and the NASDAQ declined 5.06%. The MSCI EAFE also gave back 6.19%. These losses pushed all four indexes into negative territory for the year. In addition, the weekly performance included significant volatility, as stocks had large fluctuations both within days and from one day to the next. The Dow, for example, lost over 1000 points twice during the week—and twice gained over 300 points.

During times like these, viewing events in their proper context is imperative. This week, we are going beyond our typical market update to provide you with clarity and perspective.

Our Analysis of the Recent Market Turbulence
The markets started 2018 with the wind in their sails, …

The Weekly Update

Week of February 5, 2018
By Christopher T. Much, CFP®, AIF®

After 4 straight weeks of gains, the markets have slipped. As of Friday, the S&P 500 lost 3.85%, the Dow dropped 4.12%, and the NASDAQ decreased by 3.53%. International stocks in the MSCI EAFE also took a 2.78% hit. Domestically, the losses spanned sectors and asset classes. For the S&P 500, all 11 of the index’s industries lost ground last week. This decline came after the S&P 500 had its best January performance in over 20 years.

So, what happened?

Looking at the markets’ sizable losses, you might expect that discouraging economic data came out last week—or some geopolitical drama spooked investors. On the contrary, the drops came in response to news that seems positive on the surface: Job and wage growth are picking up.

Reviewing the Jobs Report
On Friday, the Bureau of Labor Statistics reported that we added 200,000 …

The Weekly Update

Week of January 29, 2018
By Christopher T. Much, CFP®, AIF®

Stocks had an impressive week yet again, as each of the domestic indexes reached record highs and gained at least 2%. The S&P 500 added 2.23%, the Dow increased 2.09%, and the NASDAQ grew 2.31%. International stocks in the MSCI EAFE joined the growth, adding 1.49%.

On Monday, January 22, the government shutdown ended after 3 days, as House and Senate members reached an initial compromise. President Trump signed the measure on Monday evening, securing government funding until February 8.

With the funding discussion set aside for the next week or so, we believe 3 topics were of particular interest for the markets:

1. Corporate earnings
2. Global growth
3. Gross domestic product (GDP) readings

1. Corporate Earnings
We are in the middle of the best corporate earnings season in 5 years. So far, 80% of S&P 500 companies that released 4th-quarter data have …

The Weekly Update

Week of January 22, 2018
By Christopher T. Much, CFP®, AIF®

We’re only a few weeks into 2018, and stocks are showing quite a strong performance so far. Last week, major domestic indexes posted gains yet again, with all 3 up at least 5% this year. By Friday, the S&P 500 had added another 0.86%, and both the Dow and NASDAQ were up 1.04%. All 3 indexes hit new record highs at least once during the week.

In addition to the solid performance for U.S. equities, we’re also experiencing synchronized global growth. European and Asian stocks grew last week, and China’s growth data was more positive than expected. Overall, international stocks in the MSCI EAFE added a healthy 1.24% last week. Year to date, the MSCI is up 4.95%.

What happened last week?
Two key topics drove conversations: corporate earnings and a government shutdown.

1. Corporate Earnings
In the U.S., corporate earnings season …

The Weekly Update

Week of January 15, 2018
By Christopher T. Much, CFP®, AIF®

Domestic markets continued their strong start to 2018, posting gains across the board for their 2nd week. The S&P 500 added 1.57% and closed at a new record high on Friday. The index just posted its best 10-day beginning to a year since 2003, with a 4.2% gain so far this year. The Dow also hit a new record on Friday and gained 2.01% for the week. The NASDAQ increased by 1.74%, while international stocks in the MSCI EAFE joined last week’s gains, adding 1.20%.

By week’s end, we didn’t receive a tremendous amount of economic data. However, the economy did provide details that reveal it continues to pick up speed. In particular, both corporate earnings and inflation appear to be on the rise.

What We Learned Last Week

1. Corporate Earnings Continue to Increase
Earnings season is upon us, and …

The Weekly Update

Week of January 8, 2018
By Christopher T. Much, CFP®, AIF®

The first week of 2018 is behind us, and across the globe, stocks experienced a strong start to the year. International stocks in the MSCI EAFE gained 2.44% last week. In the U.S., our major indexes also leapt forward, reaching several records and milestones.

Domestic Index Performance for the First Week of 2018

S&P 500:

• Gained 2.60%
• Hit 2,700 for the first time
• Posted its largest weekly gain since December 2016

Dow:

• Gained 2.33%
• Hit 25,000 for the first time
• Had its best yearly start since 2006

NASDAQ:

• Gained 3.38%
• Hit 7,000 for the first time
• Posted its largest weekly gain since December 2016
• Had its best yearly start since 2006

What drove markets last week?

A variety of factors affected the markets last week—from tax reform to commodity prices. Interestingly, considering the indexes’ positive performance, one of the biggest economic headlines seemed …

The tax debate has settled (for now)

While much of the political fire and fury from Congress’ tax plan debate has settled, some of the economic smoke still lingers as financial analysts and private investors plot their way through the new $1.4 trillion law’s long-range ramifications. Along with new rates and deductions, the new tax law makes changes to the AMT and estate tax exemption levels.

Want to know more? Grab our new article now for some of the details http://bit.ly/newtaxplan

The Weekly Update

Week of January 1, 2018
By Christopher T. Much, CFP®, AIF®

In the final trading days of a strong 2017, U.S. indexes lost some ground. During the holiday-shortened week, the S&P 500 dropped by 0.36%, the Dow lost 0.14%, and the NASDAQ gave back 0.81%. A selloff toward the end of the day on Friday contributed to the domestic indexes’ weekly losses. International stocks in the MSCI EAFE ended the week in positive territory, gaining 0.89%.

Despite the losses, all three major domestic indexes experienced their best year since 2013. During 2017, the Dow hit 71 record highs, and the NASDAQ gained in all but 1 month for the first time ever.

Overall, indexes posted the following growth for the year:

• S&P 500 up 19.42%
• Dow up 25.08%
• NASDAQ up 28.24%
• MSCI EAFE up 21.78%

In addition to sizeable gains, there was also very little market volatility in 2017. The S&P …

The Weekly  Update

Week of December 25, 2017
By Christopher T. Much, CFP®, AIF®

As we headed into the long holiday weekend, the markets continued to climb as tax reform moved forward. For the week, the S&P 500 closed up 0.29%, the Dow rose 0.43%, and the NASDAQ gained 0.35%. International stocks in the MSCI EAFE increased by 1.23%.

Before leaving for his holiday vacation, President Trump signed a new tax bill and a measure to temporarily delay a possible government shutdown. Supporters of the $1.5 trillion tax cut, which dramatically reduces the corporate tax rate, believe it will encourage businesses to invest, hire more workers, and increase wages. Some companies are already celebrating by offering bonuses to their employees and promising to improve infrastructure in the workplace.

Tax Bill Highlights

The historic bill is the largest tax revamp in more than 30 years and makes several changes to the federal tax system, including:

…