More Historic Highs

Weekly Commentary — November 4th, 2019

The Week on Wall Street

A better-than-forecast jobs report prompted a stock market rally Friday, two days after traders witnessed another interest rate cut by the Federal Reserve.

Both the S&P 500 and Nasdaq Composite ended the week at historic peaks, while the Dow Jones Industrial Average settled less than 12 points under its all-time record close. The Nasdaq rose 1.74% for the week; the S&P gained 1.47%. The Dow added 1.44%. MSCI’s EAFE benchmark, which measures developed stock market performance outside the U.S. and Canada, improved 0.58%.[1],[2],[3]

Economy Adds 128,000 Jobs in October

This net increase far surpassed the gain of 85,000 projected by a Bloomberg poll of economists. These job gains occurred even as last month’s General Motors strike impacted hiring in the manufacturing sector.

Unemployment rose slightly to 3.6% in October, an effect of more people entering the job market. Likewise, the U-6 rate, counting both unemployed and underemployed, Americans ticked up to 7.0%.[4]

The Fed’s Latest Interest Rate Decision

Last week, the central bank made its third quarter-point rate cut since July, leaving the target range for the federal funds rate at 1.50-1.75%.

Something was missing from the latest Fed policy statement. Since June, a passage had noted that the Fed was ready to “act as appropriate to sustain the expansion.” In the latest statement, that language disappeared. At a press conference Wednesday, Fed Chair Jerome Powell commented that Fed officials “see the current stance of monetary policy as likely to remain appropriate.”[5]

Where Trade Talks with China Stand

There were further negotiations between U.S. and Chinese officials Friday, and China’s commerce ministry announced that both sides had “reached consensus on principles” integral to the first phase of a new trade pact. U.S. Trade Representative Robert Lighthizer noted only that the latest round of conversation had brought “progress in a variety of areas.”[6]

 

THE WEEK AHEAD: KEY ECONOMIC DATA

Tuesday: The Institute for Supply Management presents its latest Purchasing Managers Index for the U.S. service sector, gauging business activity and new orders.

Friday: The University of Michigan’s preliminary November Consumer Sentiment Index appears, measuring consumer confidence levels.

Source: Econoday, November 1, 2019

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: Marriott International (MAR), Sysco (SYY), Uber (UBER)

Tuesday: Allergan (AGN), Toyota (TM)

Wednesday: CVS Health (CVS), Qualcomm (QCOM)

Thursday: Booking Holdings (BKNG), Walt Disney Co. (DIS)

Friday: Duke Energy (DUK), Enbridge (ENB), Honda (HMC)

Source: Zacks, November 1, 2019

 

“When you start seeing your value, you’ll find it harder to stay around people who don’t”

– Unknown

 Be Safe Online

In today’s age of online shopping, online banking, and email databases, it’s more important than ever to be safe online. The IRS shares some of their top tips on how to protect your data:

  • Update Your Security Software – Most computers come with built-in security software in their operating system, and it’s important to always keep your computer up to date to make sure it’s running properly. You can also purchase security software from external companies. Just make sure to research the company first to make sure they’re not a scam.
  • Only Provide Data to “https://” Sites – Earlier this year, Google released an update requiring any sites that gather data, such as credit card information, to be a secure site. This means that their website will start with “https://” instead of “http://.” This update helps keep your data safe.
  • Be Cautious When Using Public Wireless Networks – Working in a coffee shop with free Wi-Fi is convenient, but these wireless networks aren’t always secure. Be careful about what information you share while connected to these free wireless networks, especially if they don’t require a password.

* 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[7] 

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.


[1]https://www.reuters.com/article/us-usa-stocks/sp-500-nasdaq-set-records-on-jobs-data-trade-headway-idUSKBN1XB3ZD

[2]https://www.wsj.com/market-data

[3]https://quotes.wsj.com/index/XX/990300/historical-prices

[4]https://time.com/5716189/us-adds-128000-jobs-october-2019/

[5]https://www.cnbc.com/2019/10/30/fed-decision-interest-rates-cut.htm

[6]https://www.foxbusiness.com/markets/us-china-trade-talks-reach-consensus-on-principles?cmpid=prn_investors

[7]https://www.irs.gov/newsroom/seven-tips-to-protect-your-computer-online

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