tax reform

September 18, 2018

September 18, 2018

Stocks surged at the open despite escalation of the trade war with China. The Dow is up 118 pts and the SPX is up .58%. Technology and consumer discretionary sectors—thought to be especially vulnerable to a trade war—are leading the way with 1% gains. European markets will close modestly higher and Asia was mostly higher overnight. In fact, China’s Shanghai Composite Index rose 1.8% and copper prices surged more than 3%. That is absolutely not the expected reaction to more trade tariffs. Commodities are higher on the day and the US dollar is trading flat. Iron ore is up over 1% and WTI crude oil is up around $69.60/barrel. Bonds are selling off today as interest rates head higher. The 5-year and 10-year Treasury yields are up around 2.92% and 3.03%, respectively. In addition, the yield curve steepened just a bit.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

May 15, 2018

Stocks opened lower this morning. The Dow is currently down 243 pts and the SPX is down .8%. The Nasdaq is off 1%. All eleven major market sectors are in the red, led by real estate (-1.6%), healthcare (-1.3%), tech (-1.2%), and utilities (-1.1%). The only bright spots today are banks and small-caps. The VIX Index jumped up to 14.2 in early trading and VIX June futures are trading around 15.2. So there’s no real fear out there. The dollar is higher on better than expected economic data and most commodities are lower—even gold. WTI crude oil is down around $70.60/barrel. OPEC just reported that the global oversupply in oil has been virtually eliminated. Bonds are selling off as interest rates rise. The 5-year Treasury note yield is up around 2.91% and the 10-year is  trading at 3.07% for the first time since 2011. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

April 10, 2018

Stocks gapped up at the open as trade tensions eased (see below). The Dow is currently up 525 pts and the SPX is up 1.8%. Materials, energy and tech sectors are all up over 2% in early trading. The VIX Index is back down to 20.7. European markets are up about .7% and Asia was up at least that much overnight. Oil, gas and metals are trading higher as well. WTI crude oil is back up to $65.20/barrel. Copper and iron ore are up well over 1%. Bonds are not surprisingly down in price. The 5-year and 10-year Treasury note yields ticked up to 2.63% and 2.80%, respectively.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

April 9, 2018 Special Update

Up One Day, Down The Next

Last Friday’s jobs report was supposed to be the big event of the week. It was supposed to either send the all clear signal or upset the apple cart; to confirm or deny a spike in wage inflation; to let us rest easy about labor market strength or perhaps reveal a slowdown in hiring momentum. Alas, it never delivered the excitement traders were looking for. 

Not that Friday’s trading session lacked excitement. The Dow fell 572 points and the S&P 500 fell 2.2%, capping a week of extraordinarily large rollercoaster swings. In fact, Vanguard’s Jack Bogle said that with the possible exception of the 1987 crash, he’s never seen such volatility as characterizes this stock market. 

The jobs report and its standard set of figures on payrolls, unemployment, and wage growth turned out OK. Inflation isn’t spiking. The labor market isn’t over-heating. New payroll growth decelerated, but that was largely due to weather-related issues. Other metrics like average workweek were on track. Just as with other recent economic data, there’s nothing in the report to cause an unhinging of the stock market. Nothing to explain the spike in volatility. 

What hit the market on Friday was the perfect storm of words, not data. President Trump is again engaged in a war of words with the Chinese. Thursday evening, Mr. Trump asked the US Trade Representative to consider additional trade tariffs on $100bil worth of Chinese imports. In response, China’s Commerce Ministry issued a statement that it is ready to fight a trade war. “The Chinese side will follow suit to the end and at any cost, and will firmly attack, using new comprehensive countermeasures, to firmly defend the interest of the nation and its people.” On Friday morning, Mr. Trump Tweeted that the World Trade Organization (WTO) is giving an unfair trade advantage to China due to its classification of that country as “developing.” But while the war of words progressed, neither side moved closer to face-to-face negotiations. 

And there are signals that this issue isn’t going away soon. US Treasury Secretary Mnuchin said in a CNBC interview that while the Trump Administration doesn’t want a trade war, “there is the potential” for one. He is “cautiously optimistic” that both sides will reach a solution. In a radio interview, the president said, “I’m not saying there won’t be a little pain, but the market has gone up 40%, 42% so we might lose a little bit of it. But we’re going to have a much stronger country when we’re finished.” 

Also thrown into the mix on Friday was congressional testimony by the new Federal Reserve Chair Jerome Powell. He noted strong economic momentum in the US. “Given that the current pace of growth is above trend, my view is that we need to continue on the path of raising interest rates.” Mr. Powell’s message was a positive one, as expected. But considering the day’s events, investors were not in the mood to hear about further monetary tightening. The Dow took another leg down as he spoke. Mr. Powell tried to steer clear of trade tariff concerns, but when asked he said it’s “really too early” to estimate any economic impact. 

In that reply, Mr. Powell showed wisdom. We don’t yet know whether Mr. Trump’s sound bites constitute a new durable policy or simple rhetoric used as a negotiating tactic. We also don’t have a clue about the timeline for tariffs. Mr. Mnuchin said they “will take some period of time to go into effect. There will be public comment, while we’re in the period before the tariffs go on. We’ll continue to have discussions.” Besides, words change from day to day. Over the weekend, Mr. Trump eased his tone, Tweeting “President Xi and I will always be friends, no matter what happens with our dispute on trade.” Hence, the stock market bump this morning. 

The culprit for market volatility is clear. Words, in speeches, interviews and Tweets, made traders shoot first and ask questions later. That immediate re-pricing of investment risk may prove to be unwarranted, however. Aside of positive economic momentum, corporate earnings are expected to be very strong this year. Core business trends are largely positive and by one estimate $800bil in economic benefit will come from tax reform. US companies will begin reporting first quarter results this week, and we very much hope that investors and traders pay more attention to those reports than to presidential Tweets. As Bloomberg posits, “Markets Want to Rally—If Politicians Will Let Them.”
 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

December 20, 2017

Stocks opened mixed this morning (Dow +16 pts; SPX flat). Utilities and real estate are down for the second straight session, and consumer staples about-faced to fall .7%. Telecoms are the best performing sector at the moment, up 1.5%, likely because they will really benefit from lower corporate taxes. Energy, materials and industrials are also trading higher. European stock markets will close in the red and Asia was mostly down overnight. The dollar is a bit weaker today against a basket of foreign currencies and commodities are not surprisingly trading higher. WTI crude oil is up slightly to trade around $57.80/barrel. Bonds are again selling off, with yields higher. And again, this is probably the biggest story of the day. The 5-year Treasury yield spiked to 2.24% and the 10-year yield rose to 2.49%, breaking out of its recent trading range. Importantly, the yield curve has steepened over the last two trading sessions. That is, the difference between the 2-year and 10-year Treasury note yields has increased from 51 basis points to 62 basis points. When longer term rates rise faster than short term rates, it is a signal of rising inflation expectations. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

December 18, 2017

The major stock market averages gapped up at the open (Dow +175 pts; SPX +.6%). Energy and materials sectors are in the lead, up over 1%. Utilities, on the other hand, is the only sector in the red. Small-caps are surging 1.2% on tax reform optimism. The VIX Index remains below 10 and VIX January futures are trading around 11.3. So there’s not much fear out there. European markets are poised to close up over 1% today and Asia was up overnight. Including the effects of currency, the Hang Seng Index is up 31% this year and the Euro Stoxx 50 Index is up 23%. Commodities are mostly in the green today, with WTI crude oil up around $57.50/barrel. Bonds are mostly unchanged, however. The 5-year and 10-year Treasury bond yields are trading at 2.15% and 2.37%, respectively.

According to Bloomberg, both the House of Representatives and the Senate are planning on midweek votes to pass the final version of the tax reform bill. This morning, CNBC interviewed Jim Paulsen of the Leuthold Group, who said passage of the tax bill is already priced into the stock market and this looks like a “buy the rumor and sell ultimately on the news” event. Corporate earnings will be boosted by the tax cut, but the market’s P/E multiple (20x) is rather high. And with unemployment three-tenths away from a 50-year low, interest rates probably need to reset higher. That’s “where the tension might turn” in 2018. Typically, stock market P/E ratios fall when interest rates rise.

Analysts at Goldman Sachs expect another good year for stocks in 2018. The firm’s chief US equity strategist projects the S&P 500 Index will climb another 7% over the next 12 months. And he doesn’t expect a return of volatility.  


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 30, 2017

Stocks gapped up at the open, reversing yesterday’s decline and setting new highs. The Dow is currently up 181 pts and the SPX is up .67%. The energy sector is rebounding about 1% after a 5% correction earlier this month. Semiconductors are also up 1% after suffering a 5.7% drop over the last few days. Interestingly, European and Asian stock markets were down overnight. And the VIX Index (Dec. futures contract) is trading up near 11.5. The dollar is weaker against a basket of foreign currencies today, mostly due to Euro & Pound strength after Brexit negotiators made constructive progress toward a split. Commodities are mixed; WTI crude is trading up around $57.70/barrel. OPEC meets today in Vienna. Bond yields are slightly higher on the day. The 5-year Treasury yield is up to 2.11% and the 10-year is now at 2.39%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 27, 2017

Stocks opened up this morning but quickly gave way. The Dow is currently up 26 pts and the SPX is flat. Retailers, gold miners, utilities and telecoms are faring well today. On the other hand, energy and materials sectors are in the red. The VIX Index is trading up around 10. The dollar is about flat against a basket of foreign currencies and most commodities are lower. WTI crude oil is down 1.5% to $58/barrel. Bonds are mostly unchanged today. The 5-year Treasury yield is hovering around 2.05% and the 10-year yield is trading at 2.32%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 21, 2017

Stocks gapped up at the open (Dow +175 pts; SPX +.68%). Tech and healthcare are the best-performing sectors in early trading (up over 1%). Telecoms and banks, however, aren’t participating. The VIX is retreating toward 9.8. European markets are poised to close up about .5% and Asia traded higher overnight. The dollar is unchanged and most commodities are trading higher. Copper is up about 1%, recovering from a recent pullback. WTI crude oil is up a bit to trade around $56.70/barrel. Shorter-term bonds are selling off again as yields head higher. The 5-year Treasury yield is up around 2.10% (highest since mid-March). Strangely, longer-term yields are not moving today. The 10-year Treasury is unchanged at 2.36%. And that means the yield curve is flattening. Since November 10th, we’ve seen short rates rise while long rates remained about flat. This bears watching because it implies that bond traders believe the Fed will continue hiking short rates even though long-term inflation expectations aren’t rising.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 10, 2017

Stocks opened lower again this morning (Dow -40 pts; SPX -.18%). The reason: “Doubts swirl on tax overhaul” according to Bloomberg. In the middle of yesterday’s session, the SPX briefly fell 1.18% from its recent all-time high, then recovered. Famed investor Mario Gabelli pointed out that a “1% correction is not a big event,” and if interest rates stay below 2.5%, the market can continue rallying for another “year or two.”  Bank of America/Merrill Lynch says yesterday’s rout was a “dress rehearsal, not the Big One.” The firm notes “insane gains” this year, especially within the tech sector, and one can expect a pullback. The firm says a full stock market meltdown would “require recession risk or moves higher in wage inflation, bond yields, and volatility or credit spreads.” They don’t see that in the near term. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 9, 2017

Stocks gapped down at the open this morning (Dow -130 pts; SPX -.55%). We’re hearing that the Senate’s tax reform plan differs materially from the House plan, and investors don’t like the uncertainty. Ten of eleven major market sectors are lower in early trading, led by tech and industrials. Remember, the tech sector is up 37% so far this year and is probably due for some give-back. Only consumer discretionary is up modestly (due to Disney and Comcast). By the way, European markets are poised to close about 1% lower. WTI crude oil about-faced and is trading up 1% to about $57.30/barrel. Bonds are selling off as yields tick higher. The 5-year and 10-year Treasury yields are up around 2.02% and 2.34%, respectively. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 8, 2017

Stocks opened lower this morning. The Dow and SPX are currently off 15 pts and flat, respectively. Real estate and consumer staples—both defensive sectors—are higher in early trading. Tech is picking up at the moment as well. But most everything else is in the red. Financials and energy are down.7%. And I’d point out that both US and European banks have been underperforming for a week or two now. The VIX Index is up a bit but still trading at 10, which is very low. The dollar is flat today against a basket of foreign currencies and most commodities are lower for the second straight session. WTI crude oil is trading down to $55.60/barrel. Copper is down slightly this month, probably just some give-back after a monster 30% rally from May to October. The 5-year and 10-year Treasury note yields are flat around 1.99% and 2.31%, respectively. So not much excitement in the bond world.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

November 2, 2017

Stocks sank at the open (Dow flat; SPX -.22%; Nasdaq -.3%). Consumer discretionary, materials and telecom sectors are down about 1% in early trading. Real estate and utilities are in the green as interest rates fall. The VIX Index is down around 10. The dollar is down a bit today (and down about 7% on the year) and commodities are up slightly. WTI crude oil is trading flat at $54.30/barrel. Bonds are trading modestly higher after President Trump announced his nominee for the Chair of the Federal Reserve. The 5-year and 10-year Treasury yields are hovering around 2.0% and 2.36%, respectively. Famed economist Mohamed El-Erian says the nominee, Jerome Powell, brings “continuity and experience” and he is a wise choice.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

September 27, 2017

Stocks opened slightly higher this morning (Dow +5 pts; SPX +.11%). Financials, especially banks, and semiconductors are up over 1% in early trading. On the other hand, gold miners, utilities and consumer staples are down about 1%. European markets are poised to close up about .3% today. The dollar is a bit stronger against a basket of foreign currencies and commodities are mixed. WTI crude oil is trading up around $52.13/barrel. We haven’t seen a 52 handle on oil since April. Bonds are selling off today as interest rates tick higher. The 5-year Treasury note yield is back up to 1.90%, a two-month high. The 10-year Treasury note yield is up around 2.29% and the next stop is probably 2.39%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

April 27, 2017

The major stock market averages opened modestly higher but quickly faded. The Dow is down 34 pts and the SPX is down .1%.  Retailers, semiconductors, rail lines, and social media are trading up this morning. Energy, banks, and telecom carriers are down sharply. The VIX Index is down again today to trade under 11, signaling very little fear among traders. European markets are poised to close down about .5%. Commodities are mostly lower (gold -.3%, copper -1.1%, WTI crude oil -2.6%). It really looks like oil wants to fall toward $47/barrel in the near term. Bonds are modestly higher in price as yields edge lower. The 5-year Treasury yield is trading at 1.82% and the 10-year is trading at 2.29%. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

March 27, 2017

Stocks opened lower again this morning (Dow -65 pts; SPX -.26%). The Dow is on a 7-day losing streak. Banks are leading the way lower (-.9%), along with transports (-.3%) and semiconductors (-.25%). Gold miners and biotechs are actually in the green. The VIX Index is up around 13.5 as consternation over the GOP healthcare bill grows. European markets just closed slightly lower and Asia was down overnight. The dollar is lower today, and is now down 3% year-to-date. But that’s not giving a lift to commodities this morning. WTI crude oil is down modestly to trade around $47.60/barrel. Bonds are rising in price as yields fall. The 5- and 10-year Treasury yields are down to 1.91% (1-month low) and 2.38%, respectively.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

February 23, 2017

The major stock market averages are lower in early trading. The Dow is currently flat and the SPX is down .23%. The defensive sectors are doing better (utilities, consumer staples, telecoms) but most other sectors are lower (i.e. tech, industrials, financials, materials). By the way, year-to-date the SPX is up 5.4% and the best-performing sectors are tech (+9%) and healthcare (+7%). The only two sectors in the red for the year are energy (-5.8%) and telecom (-3.7%). Today, the dollar is a bit lower and commodities are trading a bit higher. WTI crude oil is up 2% to $54.68/barrel. Bonds have been moving higher for the last week, with yields headed lower. The 5-year Treasury yield is back down to 1.87% and the 10-year yield is trading at 2.39%. The 2-year Treasury yield isn’t spiking either, and that suggests traders aren’t convinced the Federal Reserve will raise interest rates in March. 


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.