The Bull Market Continues – Weekly Update

August 28, 2018 | By Steven DiGregorio

Last week marked a noteworthy milestone in our economy: On Wednesday, August 22, the bull market entered its 3,453rd day, the longest such run in U.S. history. In the past 9 plus years, domestic indexes have come quite a ways since the dark days of the financial crisis. The S&P 500 is now more than 4 times the level that it was when the bull market began on March 9, 2009.[1]

In fact, both the S&P 500 and NASDAQ closed last week with new record highs.[2] The S&P 500 added 0.86%, the Dow increased 0.47%%, and the NASDAQ gained 1.66%.[3] International stocks in the MSCI EAFE also grew, increasing 1.52% for the week.[4]
This domestic growth occurred against a backdrop of geopolitical events. Investors considered new tariffs between China and the U.S., as well as legal developments potentially related to President Trump. However, economic updates seemed to hold the most sway over market performance last week.[5] 

 

What did we learn about the economy last week?
Beyond passing a major milestone in the bull market, we also received some key economic updates, including:

  • The Fed’s interest rate increases should continue at a gradual pace.
    In talks last week, Fed Chairman Jerome Powell called the economy “strong” and said inflation isn’t overheating. He indicated the central bank intends to maintain its current pace of interest-rate raises. Markets increased after his remarks.[6]
  • The labor market remains strong.
    New claims for unemployment fell for the 3rd week in a row and were below expectations, continuing on July’s trend that included the lowest numbers since 1969. This data indicates that, despite U.S. companies facing ongoing trade tension, the labor market remains on solid ground.[7] 
  • Business investment may be on the rise.
    Data for durable goods orders includes details that can hint at how businesses plan to approach spending. This so-called “non-defense capital goods excluding aircraft” grew far more than anticipated in July. The reports indicate that business investments started the 3rd quarter on solid ground.[8] 
These updates may help support economists’ perspectives that the bull market still has life left.[9] If you have questions about where your financial life stands today and in the future, we’re here to talk.

ECONOMIC CALENDAR

Tuesday: Consumer Confidence
Wednesday: GDP
Thursday: Personal Income and Outlays, Jobless Claims
Friday: Consumer Sentiment

Notes: All index returns (except S&P 500) exclude reinvested dividends, and the 5-year and 10-year returns are annualized. The total returns for the S&P 500 assume reinvestment of dividends on the last day of the month. This may account for differences between the index returns published on Morningstar.com and the index returns published elsewhere. International performance is represented by the MSCI EAFE Index. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly.

Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues.
If you would like us to add them to our list,
simply click on the “Forward email” link below. We love being introduced!


If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.

The content of this article is for informational purposes only and is not intended as an offer of investment advice, investment strategy or to buy, transfer or sell any security or other investment vehicle. Information contained herein has been obtained from sources deemed reliable but Spire Wealth Management LLC, Spire Securities LLC and their affiliates, including Compass Asset Management Group LLC, do not guarantee its accuracy. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions of Spire Wealth Management LLC, Spire Securities LLC or its affiliates.

Spire Wealth Management LLC is a federally Registered Investment Advisor. Securities offered through an affiliate, Spire Securities LLC. Member FINRA/SIPC

By accessing any links contained in this article you will be leaving Spire Wealth Management LLC & its affiliates and Compass Asset Management Group LLC websites and entering a website hosted by another party. Although Spire Wealth Management LLC & its affiliates and Compass Asset Management Group LLC have approved these as reliable partner sites, please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Spire Wealth Management LLC & its affiliates Compass Asset Management Group LLC websites. The other parties are solely responsible for the content of their websites. We encourage you to read and evaluate the privacy and security policies on the sites you are entering, which may be different than those of Spire Wealth Management LLC & its affiliates Compass Asset Management Group LLC.

Diversification does not guarantee profit nor is it guaranteed to protect assets.

International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.

The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.

The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.

The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.

The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indices from Europe, Australia, and Southeast Asia.

The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.

Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

Past performance does not guarantee future results.

You cannot invest directly in an index.

Consult your financial professional before making any investment decision.

Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

By clicking on these links, you will leave our server, as the links are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site

 

Tags: Bull Market, China, DJIA, Dow, economy, employment, Fed, FOMC, GDP, Inflation, Interest Rates, NASDAQ, S&P 500, Unemployment

STEVEN M DIGREGORIO is President of Compass Asset Management Group, LLC and an Investment Advisor Representative with Spire Wealth Management, LLC.
Connect with him on LinkedIn.
Back to Results | |