Weekly Commentary — 5/13/19
The Week on Wall Street
As we noted recently, Wall Street has a wandering eye. Last week, it focused on the new tariff threats in the ongoing U.S.-China trade dispute. Stocks fell across five trading sessions: the Dow Jones Industrial Average lost 2.12%, the S&P 500, 2.18%; the Nasdaq Composite, 3.03%. International stocks also fell: the MSCI EAFE index declined 3.06%.
Earnings and big-name initial public offerings mattered little last week. Traders were more concerned about how consumers and corporations might be affected by higher import taxes in future quarters.[i],[ii]
At 12:01 a.m. Friday, duties on $200 billion worth of Chinese products coming to the U.S. rose from 10% to 25%. Just days earlier, President Trump had tweeted that the U.S. might also tax another $325 billion of Chinese imports, mainly consumer goods.
A few weeks ago, market watchers noted the huge number of initial public offerings anticipated for 2019. One well-known tech firm completed its IPO on Friday, and the wave of tech IPOs is still building. According to research firm CB Insights, the average stock market valuation of the venture-capital-backed tech companies going public this year is $9.6 billion.[v]
THE WEEK AHEAD: KEY ECONOMIC DATA
Wednesday: April retail sales figures from the Census Bureau.
Friday: The University of Michigan’s preliminary May consumer sentiment index, a measure of consumer confidence.
Source: Econoday / MarketWatch Calendar, May 10, 2019
THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Monday: Take-Two Interactive (TTWO)
Tuesday: Agilent (A), Ralph Lauren (RL)
Wednesday: Alibaba (BABA), Cisco (CSCO), Macy’s (M)
Thursday: Applied Materials (AMAT), Nvidia (NVDA), Walmart (WMT)
Friday: Deere & Co. (DE)
Source: Morningstar.com, May 10, 2019
“You don’t become what you want, you become what you believe.”
– Oprah Winfrey
Tax Facts About Renting Out Residential Property
For individuals who rent out their residential property for income, there are different tax rules that apply based on whether they used the property as a residence at any time over the course of the year.
Residential rental property may include a single house, condominium, apartment, mobile home, vacation home, or similar property. These properties are often referred to as dwellings. Taxpayers renting the property can use more than one dwelling as a residence during the year. Using a dwelling for personal purposes for more than the greater of 14 days or 10 percent of the total days rented to others at a fair rental value is considered a residence. Personal use includes:
- Any person who owns an interest in the property or a family member of such person
- Anyone who has an arrangement that lets the owner use some other dwelling
- Anyone using the property at less than fair rental value
Personal use does not include days for repair and maintenance if the work is being done on a largely full-time basis.
* 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]
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