Dow Crosses 29,000 Points in January

2019 was a solid year for the U.S. economy and for the U.S. stock market.  At the start of the year stocks were coming off a steep sell-off.  In the 4th quarter of 2018 the S&P 500 lost nearly 20% from its high earlier in the year.  As 2018 closed the Federal Reserve was on an aggressive path to tighten the money supply.  It was raising interest rates in … [Read more...]

The Dow Closes Above 28,000

On Friday, November 15th the Dow closed above 28,000 for the very first time. This is the breakout we have been waiting for. From January 2018 until late October of this year the market moved sideways and made no progress. Five times since January of 2018 the Dow approached the 27,000 mark but was unable to decisively break through until the end of … [Read more...]

Recession? Yes or No

The word Recession hit the airwaves on August 14th and a stock market sell-off ensued. The Dow dropped 800 points (-3.05%) on that day. The catalyst was the inversion of the yield curve. The yield on the 10 Year US Treasury fell below the yield on the shorter 2 Year Treasury. A typical relationship is for the longer term Treasuries to pay a higher yield than … [Read more...]

Stock Market regains May losses

In June the stock market and the bond market rallied sending conflicting signals about the economy.  It is unusual for these two markets to move in the same direction.  In May the stock market pulled back on a lack of progress with China trade talks and bond prices rose.  In June stock prices and bond prices both moved higher.  The report from the June … [Read more...]

Geopolitical Uncertainties Roil the Markets

The stock market gave back a portion of its year-to-date return in the month of May.  The US economy remains strong, but other uncertainties caused some investors to leave the stock market in favor of US Treasuries in May.  Stocks declined and bonds rallied. In mid-April investors were optimistic that the US and China would reach a mutually satisfactory … [Read more...]

Strong Economic Numbers Fuel the Market Uptrend

The second quarter of 2019 began with solid gains in the stock market.  Investors are acting as if they expect the Federal Reserve to refrain from any interest rate increases for the rest of this year and that is the consensus among analysts.  In fact, some are talking about a possible rate decrease if inflation remains tame. On the first Friday in April … [Read more...]

Is a Recession in Our Future?

In March the stock market continued its upward climb, albeit at a slower pace than the first two months of the year.  Economic activity continued at a strong pace with more job growth, wage gains, low unemployment and low inflation.  In spite of these positives, talk of a recession dominates the air waves. Why is the R-word so prevalent in such a strong … [Read more...]

Fear Controls the Market

2018 started strong in January but ended with a December marked as the worst December since 1931.  At the close of the 3rd quarter domestic stocks had recovered most of their losses from February and April, and appeared poised for a strong end to the year.  All this changed early in October as the market hit correction territory for the third time in 2018.  … [Read more...]

Interest Rates and Tariffs and the Market

The positive action in the market in the first week of November turned negative in the trading days leading up to the Thanksgiving holiday.  Investors had two major concerns.  It seemed the Federal Reserve was being too aggressive in raising interest rates and another round of tariff increases with China in January could dampen economic growth. The good … [Read more...]

The Volatile Year So Far

As the closing bell rang on Wall Street at 4:00 p.m. last Friday, it marked the end of the third quarter 2018.  Let’s take a look back at the year so far. Throughout 2017 the S&P 500 Index did not experience so much as a 3% pullback and January 2018 was one of the best months ever.  At the end of January this year we wrote the following in our monthly … [Read more...]