Weekly Update

The Weekly Update

Week of November 20, 2017
By Christopher Much, CFP®, AIF®

Domestic stock performance varied last week, with the S&P 500 and Dow losing ground for the 2nd straight week, while the NASDAQ posted gains. By Friday, the S&P 500 had dropped 0.13%, the Dow gave back 0.27%, and the NASDAQ gained 0.47%. International stocks in the MSCI EAFE stumbled, dropping 0.67%.

Tax reform remained a key focus in the markets, as investors questioned whether changes will happen by the end of 2017. The markets have largely priced in expectations that tax reform will move forward, a belief that has helped drive this year’s record prices. Treasury Secretary Mnuchin expects the President to receive a bill by Christmas, but despite his update, concerns about meeting this deadline remain. This uncertainty—combined with questions about differences between the House and Senate plans—has contributed to the market volatility we’ve seen in recent weeks.

While …

The Weekly Update

Week of November 13, 2017
By Christopher Much, CFP®, AIF®

After posting gains every week since September, U.S. stocks declined by market’s close on Friday. The S&P 500 and Dow ended their longest stretch of weekly increases since 2013, and the NASDAQ ended its own 6-week streak. By November 10, the S&P 500 declined 0.21%, the Dow was down 0.50%, and the NASDAQ slipped 0.20%. Meanwhile, the MSCI EAFE dropped by 0.45%.

While these declines are not huge, understanding why stocks dropped after several weeks of steady gains is important. The markets are incredibly complex, so we cannot point to one single detail that drove their performance. We can, however, help you gain insight into what influenced investors’ decisions.

The Market’s Drop in Context
In many ways, uncertainty is to blame for last week’s losses, from a variety of angles:

• Healthcare: Equities dropped as companies continue to analyze changing dynamics …
  

The Weekly Update

Week of November 6, 2017
By Christopher T. Much, CFP®, AIF®

Once again, the markets ended the week in positive territory—and all 3 major domestic indexes hit new record highs. The S&P 500 added 0.26%, and the Dow was up 0.45%, with both indexes notching their 8th straight week of growth. The NASDAQ was up for the 6th week in a row with a 0.94% gain. International stocks in the MSCI EAFE joined in the growth, posting a 0.90% increase.

Why did markets continue to perform well last week? In part, economic data, political developments, and policy decisions gave investors a variety of details to digest.

Perspectives We Gained Last Week

1. Tax Reform
The House of Representatives released a long-awaited tax-reform bill on November 2, which included several changes to current laws. If passed, this legislation would reduce the corporate tax rate to 20% while cutting in half the mortgage-interest …

The Weekly Update

Week of October 30, 2017
By Christopher T. Much, CFP®, AIF®

Another week, another round of positive market performance. The 3 major domestic indexes again ended the week with gains and new record highs. The S&P 500 rose 0.23% and marked a 7th-straight week of increases—its longest string of weekly gains in almost 3 years. The Dow added 0.45%, and the NASDAQ grew by 1.09%. Meanwhile, international stocks in the MSCI EAFE slipped slightly, losing 0.35% for the week.

On October 25, we learned that September home sales were higher than anticipated and durable goods orders grew by 2.2% in the same month. This data provided more evidence that the economy is on solid ground. However, two other occurrences last week contributed even more to the continuing market gains: 1) Q3 GDP numbers and 2) tech companies’ corporate earnings reports.

What Drove Markets Last Week?

1. Economic growth beat expectations.
   We …

The Weekly Update

Week of October 23, 2017
By Christopher T. Much, CFP®, AIF®

Last week, all 3 major U.S. markets hit record highs once again. The Dow added 2.00% to notch both intraday and closing records, the S&P 500 rose 0.86%, and the NASDAQ gained 0.35%. International stocks in the MSCI EAFE dipped by 0.32% for the week.

On Thursday evening, the senate passed the blueprint for a $4 trillion budget. The vote sets the stage for a tax overhaul that could lower taxes for many families and businesses. In addition, some investors believe the promise of tax cuts could push market valuations even higher.

Other investors, however, have expressed concern about the continuing market highs. Although the economy is growing and corporate earnings are up, they fear a potential market correction.

Against this backdrop, last week marked a key milestone in financial history: the 30th anniversary of Black Monday – the largest …

The Weekly Update

Week of October 16, 2017
By Christopher T. Much, CFP®, AIF®

Last Friday, all 3 major domestic indexes continued their streak of weekly gains and record highs. The S&P 500 added 0.15%, and the Dow was up 0.43%. Meanwhile, both indexes posted their 5th weekly gain in a row. In addition, the S&P 500 and Dow each hit intraday trading records on Friday. The NASDAQ also increased 0.24%, ending on a record high with a 3rd straight week of growth. International stocks in the MSCI EAFE rose as well, gaining 1.61% for the week.

What drove market performance last week?
We received a number of new reports last week, including data showing jumps in the Producer Price Index, Consumer Price Index, and Retail Sales. Recovery efforts from hurricanes contributed to the gains in all three of these readings. And they could continue to affect the markets for a while.

In …

The Weekly Update

Week of October 9, 2017
By Christopher T. Much, CFP®, AIF®

This Monday, October 9, marks the 10-year anniversary of the S&P 500’s highest point before the Great Recession. While the ensuing decade has provided quite a rocky road for the markets at times, the recovery is undeniable. The S&P 500 is now double its peak 10 years ago.

In fact, last week, markets posted one record high after another—and the S&P 500 had its longest streak of record closes since 1997. At the markets’ close, the S&P 500 added 1.19%, the Dow gained 1.65%, and the NASDAQ grew by 1.45%. International stocks in the MSCI EAFE lost 0.07%.

These domestic gains came despite stocks stumbling slightly on Friday in reaction to disappointing jobs numbers. After 7 years of monthly growth, the September jobs report indicated the first labor market contraction since 2010, with 33,000 jobs lost. The decrease was …

The Weekly Update

Week of October 2, 2017
By Christopher T. Much, CFP®, AIF®

Before we begin our usual weekly commentary, we wanted to take a moment to honor the victims of Sunday’s terrible attack in Las Vegas. Though details are still scarce, it is the most devastating mass shooting in U.S. history. Our thoughts are with the victims, their families, and with the community that now must cope with the aftermath of the tragedy. As we look for answers, let’s also remember to be grateful for the ones we love.

Last week’s final performance of Q3 saw the S&P 500 hit a new high and finish up 0.68%. Meanwhile, the Nasdaq beat previous records with a 1.07% gain, and the Dow notched a 0.25% increase to come within 0.1% of its all-time high. International markets, however, experienced a slight dropthe MSCI EAFE fell 0.19% for the week.

As the country continues its …

The Weekly Update

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

Domestic indexes were mixed last week, as the Dow gained 0.36%, the S&P 500 eked out a 0.08% increase, and the NASDAQ lost 0.33%. International stocks in the MSCI EAFE added a solid 0.68%.

Three stories that have dominated conversations and driven investor attention in 2017 continued last week:

• Healthcare policy: The Senate’s continuing discussion of healthcare reform impacted stock performance in connected industries.
• Tension with North Korea: The markets responded quietly to continuing conflict between President Trump and Kim Jong Un, although some investments saw a bump later in the week.
• Interest rate updates: While the Fed chose not to raise interest rates in its most recent meeting, it indicated that a December hike is definitely still on the table.

When announcing its latest interest rate perspectives, the Federal Reserve also indicated that it would begin to reduce …

The Weekly Update

Week of September 18, 2017
By Christopher T. Much, CFP®, AIF®

After briefly stumbling the week of September 4, domestic indexes notched significant gains last week and hit record highs. By Friday, the S&P 500 exceeded 2,500 for the first time, the Dow closed at its highest level ever, and the NASDAQ reached an intraday record. Each of the indexes gained well over 1% for the week, with the S&P 500 adding 1.58%, the Dow jumping 2.16%, and the NASDAQ increasing 1.39%. International stocks in the MSCI EAFE also performed well, with a weekly gain of 0.55%.

When looking at these sizable increases, you might expect that positive data and geopolitical calm filled the news last week. Instead, we experienced a number of occurrences that could have derailed stock performance:

• North Korea tested another missile
• London experienced a terrorist attack
• Industrial production declined in August
• Retail sales fell in …