Wednesday, March 27, 2019

Economic Update for the week of March 25th, 2019


In this week’s recap: the “yield curve” inverts for the first time this decade, the Federal Reserve adjusts its stance on interest rates, and the price of oil climbs.

Weekly Economic Update




Presented by Troy L Thompson CFP, March 25, 2019



THE WEEK ON WALL STREET

Friday, the yield of the 3-month Treasury bill exceeded the yield of the 10-year Treasury note for the first time in 12 years. For some analysts, this “inverted yield curve” may imply a short-term lessening of confidence. (Treasury yields move inversely to Treasury prices.)1

As a result, the S&P 500 ended the week 0.94% lower. The Nasdaq Composite fell 0.80%, and the Dow Industrials lost 1.19%.2,3,4

In contrast, the MSCI EAFE index following international stocks rose, gaining 0.52% for the week.5



FED SEES NO HIKES IN 2019

On Wednesday, the Federal Reserve held interest rates steady, but lowered its estimate of 2019 economic growth to 2.1%.

Last December, the central bank forecast two rate hikes in 2019. It now expects to leave rates unchanged this year, with one quarter-point hike projected for 2020.

This pivot may acknowledge a slight change in economic conditions. The Fed’s latest policy statement noted that the “growth of economic activity has slowed from its solid rate in the fourth quarter.”6   



OIL HOVERS NEAR $60

At Friday’s closing bell, a barrel of West Texas Intermediate (NYMEX) crude oil was valued at $58.85 on the New York Mercantile Exchange (NYMEX). Its value briefly climbed to $60 earlier in the week.

Month-over-month, the price of WTI crude has risen nearly 5%. Historically, higher oil prices can have a significant impact on retail gasoline prices.7



WHAT’s NEXT

A U.S. delegation is scheduled to accompany Secretary of the Treasury Steven Mnuchin to China this week for further trade negotiations. Finally, Brexit will not occur this Friday, as the European Union has extended the United Kingdom’s deadline in response to Prime Minister Theresa May’s request.8,9






T I P   O F   T H E   W E E K




When a baby comes along, it can be hard to stick to a household budget. Rather than struggle to meet old goals, adjust the budget in light of new realities. Refrain from abandoning budgeting in the wake of the change.






THE WEEK AHEAD: KEY ECONOMIC DATA

Tuesday: The Conference Board’s latest reading on consumer confidence.

Thursday: February pending home sales, and the federal government’s second estimate of fourth-quarter Gross Domestic Product (GDP).

Friday: Reports on consumer spending and new home sales, and March’s final University of Michigan consumer sentiment index, another measure of consumer confidence levels.

Source: Econoday / MarketWatch Calendar, March 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.



THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: Winnebago (WGO)

Tuesday: KB Home (KBH)

Wednesday: Lennar (LEN), Lululemon Athletica (LULU), Paychex (PAYX)

Thursday: Accenture (ACN)

Friday: Blackberry (BB), CarMax (KMX)

Source: Morningstar.com, March 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




“Life engenders life. Energy creates energy. It is by spending oneself that one becomes rich.”

SARAH BERNHARDT










T H E   W E E K L Y   R I D D L E




Determine the numeral between 1 and 100 that is also nine times the sum of its digits.



LAST WEEK’S RIDDLE: Only one bachelor has served as President of the United States. Who was he?

ANSWER: James Buchanan.






Troy L Thompson CFP may be reached at 515-432-5421 or troy@thompsonfinancialinc.com
www.thompsonfinancialinc.com


Know someone who could use information like this?
Please feel free to 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 - quotes.wsj.com/index/SPX [3/22/19] 

3 - quotes.wsj.com/index/DJIA [3/22/19]         

4 - quotes.wsj.com/index/NASDAQ [3/22/19]        


6 - cbsnews.com/news/fed-rate-hikes-none-in-2019-federal-reserve-projects-no-rate-hikes-slower-growth-this-year/ [3/20/19]

7 - money.cnn.com/data/commodities/ [3/22/19]

8 - cnbc.com/2019/03/20/trump-says-china-tariffs-could-stay-in-place-amid-trade-deal-talks.html [3/20/19]

9 - nytimes.com/2019/03/21/world/europe/brexit-extension-eu-uk.html [3/21/19]



CHART CITATIONS.



quotes.wsj.com/index/SPX [3/22/19]     

quotes.wsj.com/index/DJIA [3/22/19]         

quotes.wsj.com/index/NASDAQ [3/22/19]        

quotes.wsj.com/index/XX/990300/historical-prices [3/22/19]

markets.wsj.com [3/22/19]



treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield [3/22/19]



treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldAll [3/22/19]


Wednesday, March 20, 2019

Economic Update for the week of March 18th, 2019


In this week’s recap: the Dow, S&P, and Nasdaq all advance more than 2% in five trading sessions, while investors review tame inflation data and wait for further news in U.S.-China trade negotiations.

Weekly Economic Update




Presented by Troy L Thompson, CFP   March 18, 2019



THE WEEK ON WALL STREET

The big story last week was the sudden grounding of Boeing 737 Max 8 and 9 passenger jets in dozens of countries. The financial effects of this ban could potentially impact the airline industry and segments of the economy for months.1

While the news created a headwind for the Dow Industrials, stocks managed to post solid gains for the week. The Nasdaq Composite rose 3.12%; the S&P 500, 2.46%; the Dow, 2.25%.2,3,4

Bullish sentiment was also evident overseas. Looking at the MSCI EAFE index, international stocks advanced 1.93%.5

Any companies mentioned are for illustrative 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.

tRaDE MEETING DELAYED

Wall Street expected President Trump and Chinese President Xi to discuss trade issues this month. Thursday, Bloomberg reported that their talk had been postponed, with no firm date ahead.6   



MUTED INFLATION

The latest Consumer Price Index showed just a 1.5% rise in overall consumer costs in the year ending in February.

This number does not suggest an overheating economy. During a 60 Minutes interview last week, Federal Reserve Chairman Jerome Powell said the central bank did “not feel any hurry” to make a rate move.7



TAX TIP

If you turned 70½ last year, April 1 is your final deadline to receive your initial Required Minimum Distribution (RMD) from a traditional IRA, SEP-IRA, SIMPLE IRA, or employer-sponsored retirement plan. If you take your initial RMD from these retirement accounts this year, you must receive your second RMD from them by December 31, 2019.8

Withdrawals from traditional IRAs, SEP-IRAs, and SIMPLE IRAs are taxed as ordinary income and, if taken before age 59 1/2, may be subject to a 10% federal income tax penalty. Generally, once you reach age 70 ½, you must begin taking required minimum distributions from these plans.




T I P   O F   T H E   W E E K




If it seems you will retire before you are eligible for Medicare, be sure to make the most of your employee health benefits. Schedule doctor, optometrist, and dentist check-ups as well as any major procedures needed. Paying for this health care out of pocket could be hugely expensive, and the premiums for private insurance could be costly.






THE WEEK AHEAD: KEY ECONOMIC DATA

Wednesday: The Federal Reserve wraps up its two-day policy meeting.

Friday: February existing home sales.

Source: Econoday / MarketWatch Calendar, March 15, 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.



THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Tuesday: FedEx (FDX), Michaels Companies (MIK)

Wednesday: General Mills (GIS), Micron Technology (MU)

Thursday: ConAgra Brands (CAG), Darden Restaurants (DRI), Nike (NKE)

Source: Morningstar.com, March 15, 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




“Committing a great truth to memory is admirable; committing it to life is wisdom.”

WILLIAM ARTHUR WARD










T H E   W E E K L Y   R I D D L E




Only one bachelor has served as President of the United States. Who was he?



LAST WEEK’S RIDDLE: A mall parking lot has 1,000 parking spaces, and 40% of them are for compact cars. This morning, there are 200 compact cars and some standard-sized cars in the lot, which is 75% full. How many standard-sized cars are in the lot?

ANSWER: 750 - 200 = 550 standard-sized cars.






Troy L Thompson, CFP may be reached at 515-432-5421 or troy@thompsonfinancialinc.com
www.thompsonfinancialinc.com


Know someone who could use information like this?
Please feel free to 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 - quotes.wsj.com/index/SPX [3/15/19] 

3 - quotes.wsj.com/index/DJIA [3/15/19]         

4 - quotes.wsj.com/index/NASDAQ [3/15/19]        







CHART CITATIONS:

quotes.wsj.com/index/SPX [3/15/19] 

quotes.wsj.com/index/DJIA [3/15/19]         

quotes.wsj.com/index/NASDAQ [3/15/19]        

quotes.wsj.com/index/XX/990300/historical-prices [3/15/19] 




treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield [3/8/19]



treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldAll [3/8/19]


Thursday, March 14, 2019

Economic Update for the week of March 14th, 2019


In this week’s recap: a disappointing jobs report and a downgrade of the 2019 growth forecast for Europe give Wall Street pause.

Weekly Economic Update




Presented by Troy L Thompson, CFP     March 11, 2019



THE WEEK ON WALL STREET

As in February, investors spent most of the first full trading week of March hoping for new details in U.S.-China trade negotiations. While they waited, stock benchmarks drifted downward. From Monday’s open to Friday’s close, the S&P 500 lost 2.55%, while the Dow Industrials took a 2.66% fall, and the Nasdaq Composite weakened 3.12%. The MSCI EAFE index tracking developed markets outside the U.S. and Canada fell 1.09%.1,2,3,4

Why did stocks lose momentum? In a hint that global economic growth might be slowing, the European Central Bank abruptly reduced its 2019 GDP forecast for the eurozone from 1.7% to 1.1%. A disappointing reading on U.S. hiring also raised questions.5



Perplexing Jobs Data

According to the Department of Labor, the economy generated only 20,000 net new jobs in February. This was the smallest monthly gain since September 2017. Nevertheless, the unemployment rate fell to 3.8%, while underemployment declined sharply to 7.3%. (These decreases could reflect furloughed federal employees returning to work.) The average wage rose 3.4% in 12 months, the largest year-over-year increase in a decade.

Harsh winter weather may have impeded hiring last month, and February’s payroll growth could be revised in the Department of Labor’s April report.6   



Earnings Season Recap

The fourth-quarter reporting season is all but over. FactSet notes that the S&P 500 has seen earnings growth of 13.4% in Q4, marking the fifth straight quarter with a double-digit rise.7



final thought

Stocks lost ground last week, breaking a long string of weekly advances. The extended rally partly reflected optimism that the U.S.-China trade dispute would soon be resolved, but a deal may or may not happen. The week offered a reminder that Wall Street sees both ups and downs. Day-to-day market fluctuations should not cause you to alter your long-term approach.






T I P   O F   T H E   W E E K




Do you have a health care Flexible Spending Account (FSA) at work? Check to see if it lets you carry over up to $500 of any unused balance remaining at the end of a plan year into the next year.






THE WEEK AHEAD: KEY ECONOMIC DATA

Monday: January retail sales.

Tuesday: The Consumer Price Index, tracking monthly and yearly inflation.

Thursday: January new home sales and February retail sales.

Friday: The University of Michigan’s initial March consumer sentiment index, measuring consumer confidence.

Source: Econoday / MarketWatch Calendar, March 8, 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.



THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Tuesday: Dick’s Sporting Goods (DKS)

Wednesday: Smart & Final (SFS)

Thursday: Adobe Systems (ADBE), Broadcom (AVGO), Dollar General (DG)

Source: Morningstar.com, March 8, 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




“The functions of intellect are insufficient without courage, love, friendship, compassion, and empathy.”

DEAN KOONTZ










T H E   W E E K L Y   R I D D L E




A mall parking lot has 1,000 parking spaces, and 40% of them are for compact cars. This morning, there are 200 compact cars and some standard-sized cars in the lot, which is 75% full. How many standard-sized cars are in the lot?



LAST WEEK’S RIDDLE: How do you make the number 7 even?

ANSWER: Remove the S so “seven” becomes “even.”






Troy L Thompson, CFP may be reached at 515-432-5421 or troy@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.)


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 - quotes.wsj.com/index/DJIA [3/8/19]

3 - quotes.wsj.com/index/NASDAQ [3/8/19] 

4 - quotes.wsj.com/index/XX/990300/historical-prices [3/8/19]

5 - cnbc.com/2019/03/07/stock-market-us-china-trade-jobless-claims-in-focus.html [3/7/19]

6 - usatoday.com/story/money/2019/03/08/jobs-report-just-20-000-added-february-economists-expected-181-000/3098383002/ [3/8/19]

7 - insight.factset.com/earnings-insight-q418-by-the-numbers-infographic [3/8/19]

CHART CITATIONS:

quotes.wsj.com/index/SPX [3/8/19]   

quotes.wsj.com/index/DJIA [3/8/19]

quotes.wsj.com/index/NASDAQ [3/8/19]

quotes.wsj.com/index/XX/990300/historical-prices [3/8/19]

markets.wsj.com [3/8/19]



treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield [3/8/19]



treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldAll [3/8/19]