In this week’s recap: a strong month for equities ends with
the renewed possibility of a U.S.-China trade pact.
Weekly Economic Update
THE WEEK
ON WALL STREET
A
month of gains for stocks ended with a weekly retreat. The S&P 500 lost
0.30%; the Nasdaq Composite, 0.32%; the Dow Jones Industrial Average, 0.45%. In
contrast, overseas shares, tracked by the MSCI EAFE index, advanced 0.14%.1-2
Last
month was the best June for the blue chips since 1938, the best month for the
S&P since 1955. The Dow gained 6.9% in June; the S&P, 6.2%.3
Trade
Talks Could Soon Restart
All
week, investors had one eye on Saturday’s Group of 20 summit in Japan, where
President Trump and Chinese President Xi Jinping were slated to meet. This
weekend, President Trump announced that he and President Xi had agreed to a
resumption of trade talks between the U.S. and China. As part of that
agreement, the U.S. is holding off on placing tariffs on an additional $300
billion of Chinese goods.4
While
trade tensions certainly remain between both countries, the news that formal
discussions could resume may renew investor optimism about progress toward a
trade pact.
Powell
Cautions Against Adjusting Rates Too Quickly
In
the meantime, Federal Reserve Chairman Jerome Powell attracted attention with
new remarks on monetary policy. Powell stated last week that the Fed officials
were “mindful that monetary policy should not overreact to any individual data
point or short-term swing in sentiment.”5
While
many traders think the central bank will lower the benchmark interest rate at
its July meeting, Powell noted that there was not yet consensus for a cut among
Fed policymakers.5
What’s
AHEAD
This
will be a holiday-shortened trading week. The New York Stock Exchange will
close early Wednesday, and all U.S. financial markets will close Thursday for
the July 4 holiday. Markets reopen on Friday.
T I P O F
T H E W E E K
Your home insurance policy should include a code rider. This provision stipulates that your insurer will cover the costs of bringing your home back up to code during a rebuild. If your home is decades old, some of the wiring, roofing, and plumbing may need upgrades to meet current standards.
THE WEEK
AHEAD: KEY ECONOMIC DATA
Monday: The Institute for Supply
Management’s latest Purchasing Manager Index for the factory sector, considered
the main barometer of the state of U.S. manufacturing.
Wednesday: Payroll giant ADP’s
private-sector employment report for June.
Friday: The June jobs report from
the Department of Labor.
Source:
Econoday / MarketWatch Calendar, June 28, 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
No major earnings reports are scheduled for
this week.
Q U O T E O F T H E W E E K
“The longer I live,
the more beautiful life becomes.”
FRANK LLOYD
WRIGHT
T H E W E E K L Y
R I D D L E
What is the difference
between a schoolboy studying and a farmer watching his cattle?
LAST WEEK’S
RIDDLE: A horse was tied to a rope 5 meters long, and the horse’s food was 15
meters away. How did the horse reach the food?
ANSWER: The
rope isn’t tied to anything besides the horse, allowing the horse to roam
freely.
Troy L Thompson, CFP may be
reached at 515-432-5421 or troy@thompsonfinancialinc.com
www.thompsonfinancialinc.com
www.thompsonfinancialinc.com
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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.
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1 - wsj.com/market-data [6/28/19]
2 - quotes.wsj.com/index/XX/990300/historical-prices [6/28/19]
3 - foxbusiness.com/markets/us-stocks-wall-street-june-28-2019
[6/28/19]
4 - bloomberg.com/news/articles/2019-06-29/xi-trump-agree-to-restart-trade-talks-china-says
[6/29/19]
quotes.wsj.com/index/SPX/historical-prices
[6/28/19]
treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield
[6/28/19]
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