Weekly Commentary — May 20th, 2019
The Week on Wall Street
Stocks fell sharply at the start of last week over trade tensions, then recovered with help from strong earnings and indications that U.S.-China trade talks would continue. Even so, the major indices had a down week. The S&P 500 lost 0.76%, while the Nasdaq Composite fell 1.27%, and the Dow Jones Industrial Average declined 0.69%.
The Latest Trade Developments
A broad selloff occurred Monday after China announced it would respond to increased U.S. tariffs by boosting its own import taxes on $60 billion of U.S. products. Friday morning, the Street breathed a sigh of relief as the Trump administration decided to delay 25% tariffs planned for imported cars and car parts; they had been slated to take effect on May 18. Just hours later, President Trump announced an end to U.S. tariffs on metals coming from Canada and Mexico.
Earnings Season Winds Down
The first-quarter earnings scorecard is nearly complete, as more than 90% of S&P 500 companies have reported actual Q1 results.
Stock market analytics firm FactSet notes that 76% of these firms have beaten consensus earnings-per-share estimates. Overall earnings for S&P 500 components have surpassed expectations by 5.4%. Both these percentages are above 5-year averages.[vi]
The market is quite sensitive to trade developments at the moment, and it is unclear whether this will be a short-term trend or a long-term influence on prices. While the U.S. prepares its next moves, China also is preparing its response to any new U.S. tariffs, which could include manipulating its currency.
THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday: The April existing home sales report from the National Association of Realtors.
Wednesday: Minutes from the Federal Reserve’s May policy meeting.
Thursday: April new home sales figures from the Census Bureau.
Source: Econoday / MarketWatch Calendar, May 17, 2019
THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: AutoZone (AZO), Home Depot (HD), Kohl’s (KSS), Nordstrom (JWN)
Wednesday: Analog Devices (ADI), Lowe’s (LOW), Target (TGT)
Thursday: Best Buy (BBY), Intuit (INTU), TD Bank (TD)
Friday: Foot Locker (FL)
Source: Morningstar.com, May 17, 2019
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― Coco Chanel
Like, Hashtag, and Follow Tax Tips on Social Media
Social media is a great way to get tax tips and helpful news from the IRS. The agency uses a variety of social media platforms to share tips and information with taxpayers:
- YouTube: Get video tax tips in English, Spanish, and American Sign Language.
- Instagram: Follow the official IRS Instagram account @IRSNews for the latest tax scam information to help keep your personal data secure.
- Facebook: The IRS posts useful news and information for taxpayers and tax return preparers.
- Twitter: Follow @IRSnews for tax-related announcements and tips. @IRStaxpros tweets news and guidance for tax professionals. Tweets from @IRSenEspanol have the latest tax information in Spanish. @IRSTaxSecurity tweets tax scam alerts.
- LinkedIn: The IRS shares agency updates and job opportunities.
You can also access IRS information and your tax status with the IRS app, IRS2Go. Use the app to check your refund status, pay taxes, and find free tax help.
* 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[vii]
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