S&P 500 Nearly Makes History

The Weekly Update

Week of October 28th, 2019
By Christopher T. Much, CFP®, AIF®

The Week on Wall Street
The S&P 500 came within 0.1% of a record close Friday. Stocks were lifted last week by positive news on U.S.-China trade negotiations, plus earnings announcements.

The Nasdaq Composite posted the largest weekly gain of the three major U.S. stock indices. It rose 1.90%. Last week also brought gains of 0.70% for the Dow Jones Industrial Average and 1.22% for the S&P. The MSCI EAFE, a benchmark for developed stock markets outside the U.S., rose 1.14%.

Another Hint of Progress in Trade Talks
Friday, the Office of the U.S. Trade Representative stated that parts of a new trade deal with China were near completion. No specifics were given as of Friday’s close, but the USTR noted that negotiators had “made headway” on key issues.

Analysts think both sides may cancel certain tariffs as part of a deal. President Trump has said that he would like to sign a new trade accord with China’s President, Xi Jinping, next month.

A Gain for Consumer Sentiment
Rising to a final October mark of 95.5, the University of Michigan’s Consumer Sentiment Index advanced 2.3 points month-over-month. During August and September, the index’s level varied from 89.8 to 93.2.

What’s Next
The Federal Reserve meets this week. Will it make another interest rate cut? And if it does, could that be the last rate cut for a while? Traders will study the language of the statement and listen carefully to Fed chair Jerome Powell’s Wednesday press conference for clues.

THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday: The Conference Board presents its October Consumer Confidence Index.
Wednesday: The Federal Reserve makes its latest statement on monetary policy, and Automatic Data Processing (ADP) publishes its October private-sector payrolls report.
Thursday: The Department of Commerce offers September consumer spending data.
Friday: November begins with the Department of Labor’s October jobs report and the Institute for Supply Management’s newest Purchasing Managers Index for the factory sector, a gauge of U.S. manufacturing activity.

Source: Econoday, October 25, 2019
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Monday: AT&T (T), Alphabet (GOOG), HSBC (HSBC)
Tuesday: Amgen (AMGN), BP (BP), Mastercard (MA), Merck (MRK), Pfizer (PFE)
Wednesday: Apple (AAPL), Facebook (FB), GlaxoSmithKline (GSK), Starbucks (SBUX)
Thursday: Altria (MO), Bristol-Myers Squibb (BMY), Sanofi (SNY)
Friday: AbbVie (ABBV), Alibaba (BABA), Berkshire Hathaway (BRK.B), Chevron (CVX), ExxonMobil (XOM)

Source: Zacks, October 25, 2019
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
https://www.marketwatch.com/story/us-stock-futures-step-cautiously-higher-setting-investors-up-for-fresh-run-at-records-2019-10-25
https://www.wsj.com/market-data
https://quotes.wsj.com/index/XX/990300/historical-prices
https://reuters.com/article/us-usa-trade-china/u-s-china-close-to-finalizing-parts-of-phase-1-trade-pact-ustr-idUSKBN1X40EF
https://investing.com/economic-calendar/michigan-consumer-sentiment-320
S&P 500 Nearly Makes History2019-10-28T14:19:43-05:00

Tax Planning: Year End Preparations

Tax Planning: Year End Preparations

The Tax Cuts and Jobs Act of 2017 continues to provide Americans with opportunities and challenges as they prepare to file their taxes. As we prepare to head into tax season once again, we feel that a review of deductions, tax brackets and exemptions may be in order. Grab a copy of our updated 2020 Tax Planning piece here. http://bit.ly/2p025CF

Tax Planning: Year End Preparations2019-10-25T10:13:51-05:00

Nasdaq Composite, S&P 500 Rise

The Weekly Update

Week of October 21st, 2019
By Christopher T. Much, CFP®, AIF®

The Week on Wall Street
Earnings helped give the Nasdaq Composite and S&P 500 a slight lift last week, offsetting investor disappointment over the small scope of the preliminary U.S.-China trade deal reached on October 11. Blue chips took a small weekly loss.

The Nasdaq and S&P respectively gained 0.40% and 0.54% on the week. The Dow Jones Industrial Average retreated just 0.17%. Outdoing these three benchmarks, the MSCI EAFE index tracking stocks in developed overseas markets rose 1.35%.

The Early Earnings Picture
According to stock market analytics firm FactSet, 15% of S&P 500 companies had reported results through Friday’s close. Of those companies, 84% announced that net profits topping projections, and 64% said that revenues had exceeded forecasts.

One big question is whether overall earnings for S&P 500 firms will show year-over-year growth. There were no year-over-year earnings gains evident in either Q1 or Q2.

Retail Sales Declined Last Month
Shoppers scaled back their purchases in September. The Census Bureau announced a 0.3% dip for retail sales, the first decrease in seven months.

Auto sales can influence this number, and car and truck buying fell 0.9% last month. A fall pickup in that category may help encourage another monthly advance.

What’s Next
If you buy your own health coverage, note that the open enrollment period for 2020 health insurance plans begins on November 1 in most states. The open enrollment window closes on December 15.

THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday: The National Association of Realtors publishes a report on September existing home sales.
Thursday: A report on September new home sales arrives from the Census Bureau.
Friday: The University of Michigan’s final October Consumer Sentiment Index appears, evaluating consumer confidence levels.

Source: Econoday, October 18, 2019
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Monday: Celanese (CE), Halliburton (HAL), Sap (SAP), TD Ameritrade (AMTD)
Tuesday: McDonalds (MCD), Novartis (NVS), Procter & Gamble (PG), Texas Instruments (TXN)
Wednesday: Boeing (BA), Eli Lilly (LLY), Microsoft (MSFT), PayPal (PYPL)
Thursday: Amazon (AMZN), Comcast (CMCSA), Intel (INTC), Visa (V)
Friday: Anheuser-Busch (BUD), Verizon (VZ)

Source: Zacks, October 18, 2019
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
https://www.wsj.com/market-data
https://quotes.wsj.com/index/XX/990300/historical-prices
https://insight.factset.com/sp-500-earnings-season-update-october-18-2019
https://www.reuters.com/article/us-usa-economy-retail/weak-u-s-retail-sales-cast-gloom-over-economy-idUSKBN1WV1NG
https://www.businessinsider.com/what-is-open-enrollment-your-opportunity-to-buy-health-insurance
Nasdaq Composite, S&P 500 Rise2019-10-21T14:49:03-05:00

Trade Winds Move the Market

The Weekly Update

Week of October 14th, 2019
By Christopher T. Much, CFP®, AIF®

The Week on Wall Street
Stock prices pushed higher last week, as investors remained hyper-focused on any new developments with the U.S. trade negotiations with China.

The Dow Jones Industrial Average picked up 0.91%, while the Standard & Poor’s 500 rose 0.62%. The Nasdaq Composite index gained 0.93% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, added 2.28%.

Trade Winds
For nearly two years, investors’ moods have seemed to swing with each twist in the ongoing trade saga between the U.S. and China. Last week was no different.

On Tuesday, stock prices fell sharply on concerns that U.S.-China trade tensions had escalated. The White House announced the addition of 28 new Chinese companies to its list of firms that are banned from doing business in the U.S. Later in the day, White House officials confirmed that they had implemented travel bans on selected Chinese officials.

But prices bounced back Thursday and surged higher Friday on White House reports that suggested the trade talks between the two countries were “going really well.” Near the close Friday, the White House confirmed that the U.S. has come to a “very substantial phase one deal” with China.

Quarterly Earnings
Investors may start to get a better glimpse into third-quarter earnings this week, as more than 150 companies are expected to report on their operations.

As “earnings season” get underway, some attention may shift from the U.S.-China trade negotiations and toward company reports.

What’s Next
Some U.S. financial markets will be open, and some will be closed, on Monday, October 14, in observance of the federal holiday Columbus Day. The U.S. bonds markets and most banks will be closed. But the New York Stock Exchange and the NASDAQ will be open for regular hours.

THE WEEK AHEAD: KEY ECONOMIC DATA
Wednesday: September Retail Sales are reported before the markets open.
Thursday: Housing Starts for September are released. A “start” is defined as the beginning of excavation of the foundation for the building. Philadelphia Fed Business Outlook Survey. The survey can provide insights into the manufacturing sector.

Source: Econoday, October 11, 2019
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: Netflix (NFLX), Johnson & Johnson (JNJ), The Goldman Sachs Group (GS)
Wednesday: Abbott Laboratories (ABT), United Rentals (URI), Winnebago Industries (WGO)
Thursday: Morgan Stanley (MS), PayPal Holdings (PYPL), Intuitive Surgical (ISRG)
Friday: Coca-Cola (KO), Schlumberger Limited (SLB), American Express (AXP)

Source: Zacks, October 11, 2019
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
https://www.wsj.com/market-data
ttps://www.wsj.com/market-data
https://quotes.wsj.com/index/XX/990300/historical-prices
https://www.yahoo.com/news/1-u-imposes-visa-restrictions-195007427.html
https://finance.yahoo.com/news/u-bans-travel-chinese-officials-185734111.html
https://www.cnbc.com/2019/10/10/trump-says-china-trade-talks-are-going-very-well.html?&qsearchterm=really%20well%20trump
https://www.cnbc.com/2019/10/11/trump-says-us-has-come-to-a-substantial-phase-one-deal-with-china.html
https://www.zacks.com/earnings/earnings-calendar
Trade Winds Move the Market2019-10-14T12:21:01-05:00

Special Update: Quarterly Report

The Weekly Update

Week of October 7th, 2019
By Christopher T. Much, CFP®, AIF®

The Week on Wall Street
The fourth quarter started with a mixed week for equities. The Dow Jones Industrial Average lost 0.92% for the week; the S&P 500, 0.33%. In contrast, the Nasdaq Composite improved 0.54%. Overseas stocks pulled back: the MSCI EAFE index dipped 2.60%.

The Institute for Supply Management’s Manufacturing Purchasing Manager Index fell to 47.8 in September, its lowest level in ten years. Traders worried that the number reflected weakening business confidence. ISM’s latest Non-Manufacturing PMI also declined, but the 52.6 reading indicated growth in the service sector last month.

The Department of Labor said that employers added 136,000 net new workers in September. Unemployment was at 3.5%, a level last seen in December 1969. The U-6 jobless rate, which counts both the unemployed and underemployed, fell to a 19-year low of 6.9%. Monthly job creation has averaged 161,000 so far in 2019, down from 223,000 in 2018. This may reflect the challenge companies face trying to fill job openings in an economy with so little unemployment.

The next earnings season is just ahead. Before it begins, let’s take a look back at the third quarter.

S&P 500 Ends Quarter Higher
In a statistical coincidence, the Dow Jones Industrial Average and S&P 500 gained the same percentage in the quarter: 1.19%. The Dow settled at 26,916.83 on September 30; the S&P, at 2,976.74. Both indices registered their third straight quarterly advance. The Nasdaq Composite went sideways for Q3, ending the quarter 0.09% lower at 7,999.34.

U.S.-China Trade Disagreement Continued
On August 1, the U.S. announced tariffs on an additional $300 billion of Chinese products – some would be effective September 1; others, effective by December 15. Four days later, China devalued its main currency, the yuan, to a level unseen in 11 years – a move that immediately sent U.S. stocks 3% lower. (Devaluing the yuan made Chinese goods cheaper for buyers paying for them in dollars, effectively offsetting the impact of U.S. tariffs.) As September concluded, however, word came that trade representatives from both nations would resume talks on October 10.

The Fed Made a Move
The Federal Reserve lowered the country’s short-term interest rate by a quarter-point on September 18, to a range of 1.75% to 2.00%. Federal Reserve Chairman Jerome Powell, speaking to the media after the decision, called the outlook for the U.S. economy “favorable.” At the same time, he noted “a lot of uncertainty” surrounding the near-term economy and the Fed’s monetary policy views.

What’s Next
Trade representatives from the U.S. and China return to the negotiating table on Thursday; their meeting is scheduled to conclude on Friday. Any news stemming from their talks could quickly affect equity markets, both here and abroad.

THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday: Federal Reserve Chairman Jerome Powell speaks at the annual meeting of the National Association for Business Economics in Denver.
Wednesday: The Federal Reserve publishes the minutes from its September meeting.
Thursday: The Bureau of Labor Statistics presents the August Consumer Price Index, showing monthly and yearly inflation data.
Friday: The University of Michigan offers its preliminary October Consumer Sentiment Index, a measure of consumer confidence levels.

Source: Econoday, October 4, 2019
The Econoday and Federal Reserve economic calendars list upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: Domino’s (DPZ)
Thursday: Delta Air Lines (DAL)
Friday: Citigroup (C), Fastenal (FAST)

Source: Zacks, October 4, 2019
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
https://www.wsj.com/market-data
https://quotes.wsj.com/index/XX/990300/historical-prices
https://finance.yahoo.com/news/ism-manufacturing-101500823.html
https://www.investing.com/news/economic-indicators/newsbreak-ism-services-index-tumbles-to-3year-low-1991459
https://www.usatoday.com/story/money/2019/10/04/september-jobs-report-economy-added-135-000-145-000-were-forecast/3859017002/
https://www.barrons.com/articles/the-dow-rose-97-points-because-we-still-want-to-invest-money-in-china-51569879471
https://www.marketwatch.com/investing/index/comp/historical
https://www.piie.com/blogs/trade-investment-policy-watch/trump-trade-war-china-date-guide
https://www.bloomberg.com/news/articles/2019-08-04/asia-stocks-set-to-drop-with-trade-back-in-focus-markets-wrap
https://www.cnbc.com/2019/09/30/us-stocks-investors-monitor-us-china-trade-impeachment-inquiry.html
https://www.reuters.com/article/us-usa-fed/fed-cuts-rates-on-7-3-vote-gives-mixed-signals-on-next-move-idUSKBN1W32H7
Special Update: Quarterly Report2019-10-07T12:16:25-05:00