Weekly Commentary — April 29th, 2019
The Week on Wall Street
Stocks returned to record territory, with both the S&P 500 and the Nasdaq Composite closing at historic highs. The S&P gained 1.20% for the week; the Nasdaq, 1.85%. The Dow Jones Industrial Average lagged, losing 0.06%. The MSCI EAFE index of international stocks lost 0.52%.[i],[ii]
The S&P took only 17 weeks to fully rebound from its December low.[iii]
A Shift in Focus
Last month, Wall Street fixated on trade, reacting to even the slightest hint of progress in U.S.-China negotiations. This month, the trade talks have taken a back seat, and the fixation is on earnings.
Anxieties about a possible earnings recession may be fading. So far, first-quarter results for S&P 500 firms are 5.3% above expectations; that compares to a 5-year average of 4.8%.[iv]
At some point, trade talk will come back, or other developments will lead Wall Street to chase other trends. The thing to remember is that Wall Street is fickle: what preoccupies it one week may be shrugged off the next. Short-term trends ultimately amount to background noise during the long-term pursuit of your financial goals.
A Strong First Quarter
Friday, the Bureau of Economic Analysis said that the economy expanded at a 3.2% pace in Q1. The number surprised to the upside. Economists surveyed by Dow Jones estimated Q1 gross domestic product would increase by 2.5%.[v]
Investors have all kinds of news to consider this week. There will be a plethora of earnings calls, plus important reports on consumer spending and hiring. Also, Federal Reserve chair Jerome Powell will hold a press conference following the central bank’s May meeting.
THE WEEK AHEAD: KEY ECONOMIC DATA
Monday: March personal spending figures from the Department of Commerce.
Tuesday: The Conference Board’s April consumer confidence index.
Wednesday: The Federal Reserve announces its latest interest rate decision.
Friday: The April jobs report from the Department of Labor.
Source: Econoday / MarketWatch Calendar, April 26, 2019
THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Monday: Alphabet (GOOGL), Kemper (KMPR)
Tuesday: Amgen (AMGN), Apple (AAPL), Cummins (CMI), McDonalds (MCD)
Wednesday: Allstate (ALL), CVS Health (CVS), Humana (HUM), Public Storage (PSA)
Thursday: CBS (CBS), Cigna (CI), Dunkin’ Brands (DNKN), Gilead Sciences (GILD)
Friday: Fiat Chrysler (FCAU)
Source: Morningstar.com, April 26, 2019
“Courage is resistance to fear, mastery of fear – not absence of fear.”
– Mark Twain
Tax Credit for the Elderly or Disabled
You may be able to take the credit if you are 65 years of age or older or if you retired on total and permanent disability and have taxable disability income. There are certain limits that your income cannot exceed.
Claiming the Senior Tax Credit if You’re 65 Years or Older
Based on your filing status, there are certain qualifications. If you are married, you and your spouse must file a joint return to claim the credit.
Claims for Those Under 65 and Permanently Disabled
You’ll need to procure a physician’s certification stating that you cannot engage in gainful activity due to your mental or physical condition, and in addition, that the condition has existed or is expected to exist continuously for a minimum of 12 months or if it is expected to result in your death.
You May Not Qualify Due to Taxable Income
You may meet the above qualifications detailed above and may still be ineligible for the credit if your taxable income exceeds certain limitations. To find out more visit https://www.irs.gov/pub/irs-pdf/p524.pdf.
* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Tip adapted from IRS.gov[vi]
Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues.
If you have any questions or would like to learn more about developing strategies to pursue a prosperous and safe future, contact me today at Derek.Merkler@Parsonex.com! You can also visit my website to learn about how I help our service members and veterans plan for and achieve financial independence.
My blog discusses a myriad of financial topics and challenges, book reviews, and commentary on current events in the financial world to benefit our military and veteran community. I attempt to be as thorough as possible when examining each subject but can never account for every possible scenario. Please remember to consult with your advisers for advice on your particular situation. Thank you for reading!
Advisory Services offered through Parsonex Advisory Services, Inc. 8310 S. Valley Highway, Ste. 110, Englewood, CO 80112 (303) 662-8700.