Weekly Economic Update
Presented by Troy L Thompson, CFP, February 25,
2019
THE WEEK ON WALL STREET
Stocks rallied last week as
optimism about a potential U.S.-China trade deal grew. The S&P 500 advanced
0.80% for the week to 2,792.67. The Nasdaq Composite improved 0.86% to
7,527.54, and the Dow Jones Industrial Average gained 0.64% to 26,031.81.
The renewed prospects for a
trade pact were not the only development investors found appealing last week.
There were indications that the Federal Reserve might be a bit less committed
to its plans to raise interest rates further this year.1,2
A Look at the Fed Minutes
There were no surprises from
the Federal Reserve's Board of Governors, who released the transcript from
their January meeting on Tuesday. Investors pore over the meeting minutes
looking for clues about the Fed’s next move on short-term interest rates.
Fed policymakers appeared
split on what might be next. Some felt another rate hike was needed to help
slow the strong economy, while others favored a “wait-and-see” approach.3
Home Sales Slump
In January, existing home
sales were at their slowest pace since November 2015 and down 8.5%
year-over-year. One factor: rising home values. Last month, the median
single-family home sale price was $247,500, almost $7,000 higher than a year
ago.
Mortgage rates have now
fallen for three consecutive weeks, a development that may influence home
buying decisions in coming months. Thursday, a Freddie Mac survey found the
average interest rate on a 30-year, fixed-rate loan at just 4.35%. (A 30-year,
fixed-rate mortgage is a conventional home loan meeting the lending
requirements of Fannie Mae and Freddie Mac, but it is not guaranteed or insured
by any government agency.)4,5
FINAL THOUGHT
The Dow Jones and Nasdaq have
posted gains for nine straight weeks and are now at levels unseen since early
November. Concerns over volatility have decreased, but that does not mean it is
off the table. Whatever the market does in the coming weeks and months,
remember your investing strategy should be based on your goals, risk tolerance,
and time horizon.2
T I P O F
T H E W E E K
Many companies that sponsor employee retirement plans offer matching contributions, sometimes even dollar for dollar. If your employer will match, make sure you contribute enough to get it. The match amounts to free money.
THE WEEK
AHEAD: KEY ECONOMIC DATA
Tuesday: Fed chair Jerome Powell begins two days of
testimony on monetary policy in the Senate.
Wednesday: The National Association of Realtors releases its
latest pending home sales index.
Thursday: The federal government provides its first estimate
of fourth-quarter economic growth.
Source: Econoday / MarketWatch Calendar, February 22, 2019
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 release of data
may be delayed without notice for a variety of reasons, including the shutdown
of the government agency or change at the private institution that handles the
material.
THE WEEK
AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: AutoZone (AZO), Home Depot (HD), Medpace
(MEDP)
Wednesday: Apache (APA), Best Buy (BBY), Office
Depot (ODP)
Thursday: Anheuser-Busch (BUD), Dell Technologies
(DELL), Splunk (SPLK)
Source: Morningstar.com, February 22, 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.
Q U O T E O F T H E W E E K
“Discipline
is the bridge between goals and
accomplishment.”
JIM ROHN
T H E W E E K L Y
R I D D L E
I can point
in every direction, but I cannot reach
a destination by myself. What am I?
LAST WEEK’S RIDDLE: Nancy was
born in summer, yet she was born in January, how is this possible?
ANSWER: She was born in the
southern hemisphere, which experiences summer during our winter.
Troy L Thompson, CFP may be
reached at 515-432-5421 or troy@thompsonfinancialinc.com
www.thompsonfinancialinc.com
www.thompsonfinancialinc.com
Know
someone who could use information like this?
Please feel free send us their contact information via phone or email. (Don’t worry – we’ll request their permission before adding them to our mailing list.)
Please feel free send us their contact information via phone or email. (Don’t worry – we’ll request their permission before adding them to our mailing list.)
Troy Thompson, CFP
DBA Thompson Financial and Hanson Asset Strategies
Securities offered through FIRST HEARTLAND CAPITAL, INC.
Member FINRA & SIPC.
Thompson Financial is not affiliated with FIRST HEARTLAND
CAPITAL, INC.
This material was prepared by MarketingPro, Inc., and does
not necessarily represent the views of the presenting party, nor their affiliates.
The information herein has been derived from sources believed to be accurate.
Please note - investing involves risk, and past performance is no guarantee of
future results. Investments will fluctuate and when redeemed may be worth more
or less than when originally invested. This information should not be construed
as investment, tax or legal advice and may not be relied on for the purpose of
avoiding any Federal tax penalty. This is neither a solicitation nor
recommendation to purchase or sell any investment or insurance product or
service, and should not be relied upon as such. All market indices discussed
are unmanaged and are not illustrative of any particular investment. Indices do
not incur management fees, costs and expenses, and cannot be invested into
directly. All economic and performance data is historical and not indicative of
future results. The Dow Jones Industrial Average is a price-weighted index of
30 actively traded blue-chip stocks. The NASDAQ Composite Index is a
market-weighted index of all over-the-counter common stocks traded on the
National Association of Securities Dealers Automated Quotation System. The
Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed
of the common stocks of 500 leading companies in leading industries of the U.S.
economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New
York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the
Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a
leading provider of securities listing, trading and market data products and
services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest
physical commodity futures exchange and the preeminent trading forum for energy
and precious metals, with trading conducted through two divisions – the NYMEX
Division, home to the energy, platinum, and palladium markets, and the COMEX
Division, on which all other metals trade. Additional risks are associated with
international investing, such as currency fluctuations, political and economic
instability and differences in accounting standards. This material represents
an assessment of the market environment at a specific point in time and is not
intended to be a forecast of future events, or a guarantee of future results.
MarketingPro, Inc. is not affiliated with any person or firm that may be
providing this information to you. The publisher is not engaged in rendering
legal, accounting or other professional services. If assistance is needed, the
reader is advised to engage the services of a competent professional.
CITATIONS:
2 -
marketwatch.com/story/dow-reclaims-26000-and-ends-at-3-12-month-peak-as-stock-market-levitates-on-tariff-hope-2019-02-22
[2/22/19]
3 - bloomberg.com/news/articles/2019-02-20/fed-minutes-show-officials-unsure-on-need-for-rate-hikes-in-2019
[2/20/19]
4 - tradingeconomics.com/united-states/existing-home-sales [2/21/19]
5 - washingtonpost.com/business/2019/02/21/mortgage-rates-fall-third-week-row
[2/21/19]
CHART
CITATIONS:
quotes.wsj.com/index/SPX [2/22/19]
markets.wsj.com [2/22/19]
quotes.wsj.com/index/XX/990300/historical-prices
[2/22/19]
treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield
[2/22/19]
treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldAll
[2/22/19]
