Greetings,

 

Here are several highlights from last week’s market activity, as well as developing stories the investment team is following this week.  As always, we remain committed to helping you navigate the ever-changing investment environment.

 

The following highlights should not be viewed as a recommendation, nor is this a notification of an impending change in asset allocation.  For more information, please contact your advisor with any questions.

Mark your calendar:

  • Tuesday, January 15: Fourth quarter estimated payments are due, if required.
  • Thursday, January 31: Raymond James mails year-end retirement tax forms for 1099-R and 5498, if applicable.
  • Friday, February 15: Raymond James begins mailing 1099 tax statements.
  • Thursday, February 28: Raymond James mails amended 1099s and those delayed due to specific holdings and/or income reallocation.
  • Friday, March 15: Final Day to mail any original 1099s and continued amended 1099s as needed.

INVESTMENT TERM OF THE WEEK

ISM Non-Manufacturing Index

 

An index based on surveys of more than 400 non-manufacturing firms' purchasing and supply executives, within 60 sectors across the nation, by the Institute of Supply Management (ISM). The ISM Non-Manufacturing Index tracks economic data, like the ISM Non-Manufacturing Business Activity Index. A composite diffusion index is created based on the data from these surveys, that monitors economic conditions of the nation.

 

Source: Investopedia

In the Markets

LAST WEEK

  • 2019 opened with a bang. Continuing volatility kept investors on their toes as markets logged positives returns for the first week of the year.
  • The DJIA finished the week at 23433.16, up +1.61% on the week.  The S&P 500 closed at 2531.94, up +1.86% on the week. The NASDAQ finished up +2.34% on the week.  U.S. 10-year Treasury ended the week yielding 2.66%.   In the energy markets, crude oil settled at $47.96.  Year-to-date the S&P 500 is up +1.00%.
  • The Dow finished up on 2018’s last trading day, lifted by news that the U.S. was talking to China on trade.  On Wednesday, markets sank on news of China’s growth slowdown.
  • Apple’s (AAPL) lowered expectations drove losses on Thursday.
  • Fed Chairman Powell’s dovish comments coupled with strong jobs data pushed markets higher on Friday.

 

THIS WEEK

  • In economic news: ISM non-manufacturing data for December, JOLTS data and December CPI will be released.
  • The Bank of Canada announces monetary policy action.  The benchmark interest rate is expected to remain at 1.75%.
  • The FOMC releases minutes from its last monetary policy meeting.
  • The Treasury Department releases the monthly budget statement.  The Treasury has said that it expects the shortfall to hit $1T this fiscal year.

In the News

LAST WEEK

  • Washington Recap:  Shutdown continues, President Trump met with legislative leaders – no one budged; Democrats took control of the House, elected Nancy Pelosi as speaker and voted for a spending bill that didn’t include the wall money.
  • U.S. trade talks continued.  Trump tweeted of “big progress”.  The two countries have until March 2 to come to an agreement before the U.S. again raises tariffs.
  • Trump agreed to extend the time for U.S. troops to exit Syria.
  • North Korean leader said his country had suspended building new nuclear weapons in an attempt to restart U.S. talks.

 

THIS WEEK

  • The U.S. delegation will meet its Chinese counterpart in Beijing to discuss the trade war.
  • CES, the annual electronic trade show kicks off in Las Vegas.
  • The Shutdown enters a 3rd week as the President plans to visit the U.S. – Mexico border.
  • Clemson won the national title in college football Monday night.

Thought of the Week

Happy New Year!  We hope that everyone had a wonderful holiday season.  As the final quarter of 2018 roared to a close, interest rate and growth fears, along with geopolitical events, sparked volatility in the financial markets and reversed what was shaping up to be another good year.  The S&P 500 posted a loss of about 6.2% for 2018.

 

For the first time since 2008, all three major U.S. stock indexes were set to record annual losses.  Investors may feel shell-shocked after the worst December for stocks since 1931, but it’s important to maintain some perspective.  The recent correction was preceded by the longest bull market in history, so it could be view as an overdue repricing of stocks, as well as a reality check brought on by waning growth expectations.  Over the next two weeks we will look back on some of the market drivers from 2018 and more importantly, review key economic projections for the year ahead. Teaser: Key drivers (trade, growth concerns, rates) from year-end will most likely continues to dominate and drive market action in the first quarter of 2019.

 

While it’s easy to get caught up in the day-to-day headline news that drives short-term market action, as we always say – Remember your long-term financial game plan.

 

Your financial plan should generally be reviewed at least once a year to make sure that it's up-to-date. It's also possible that you'll need to modify your plan due to changes in your personal circumstances or the economy. As we look to the new year 2019, consider whether any of the following events have affected your personal situation:

 

  • Your goals or time horizons change
  •  You experience a life-changing event such as marriage, the birth of a child/grandchild, health problems, or retirement
  • You have a specific or immediate financial planning need (e.g., drafting a will, managing a distribution from a retirement account, paying long-term care expenses)
  • Your income or expenses substantially increase or decrease
  • Your portfolio hasn't performed as expected
  • You're affected by changes to the economy or tax laws

 

Financial planners often play a central role in your financial life, focusing on your overall financial plan, and coordinating the activities of other professionals who have expertise in specific areas.  At McGee Wealth Management we enjoy working with your other trusted advisors in a true partnership.  If you have not done so already, please let us know if there is anyone in your life we can help coordinate your financial goals.  Some examples may be:

 

  • Accountants or tax attorneys providing advice on federal and state tax issues.
  • Estate planning attorneys who help you plan your estate and give advice on transferring and managing your assets before and after your death.
  • Insurance professionals that evaluate your business insurance needs and recommend appropriate products and strategies.
  • Retirement Plan Third Party Administrators (TPAs) that provide reporting and specific plan services for your retirement plan.

 

Planning your retirement income is like putting together a puzzle with many different pieces. It is critical to review each potential income source and annually estimate how much you can expect each one to provide.  Consider reviewing your investment portfolio with your advisor to optimize your tax-efficient retirement income stream.

 

Source: Investopedia, Raymond James

 

 

Please do not hesitate to call your advisor if you have any questions.  Until we speak again, have a wonderful week.

These highlights should not be viewed as a recommendation, nor is this a notification of an impending change in asset allocation. For more information, please contact your advisor with any questions. Opinions expressed in the attached article are those of Judith McGee and are not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice.

 

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of McGee Wealth Management and not necessarily those of Raymond James. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. . Investing involves risk and you may incur a profit or loss regardless of strategy selected.  The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. stock market. The Dow Jones Industrial Average (DJIA), commonly known as “The Dow” is an index representing 30 stock of companies maintained and reviewed by the editors of the Wall Street Journal. The NASDAQ composite is an unmanaged index of securities traded on the NASDAQ system. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. Past performance does not guarantee future results. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Asset allocation and diversification do not ensure a profit or guarantee against loss. Investing in emerging markets can be riskier than investing in well-established foreign markets. Investing involves risk and investors may incur a profit or a loss. Sector investments are companies engaged in business related to a specific sector. They are subject to fierce competition and their products and services may be subject to rapid obsolescence. There are additional risks associated with investing in an individual sector, including limited diversification. Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any websites's users and/or members.

 

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MWM Economic Review

January 7, 2019

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