Peek of the Week
January 23, 2017
Leif Hagen & Donna Roberts
The Markets
Markets
weren’t quite sure which direction to move last week.
The Trump rally, which lost some
steam, gained momentum early in the week. The Standard & Poor’s 500 Index
finished January 19, the day before the inauguration, with its biggest
election-to-inauguration gain since Bill Clinton won a second term in 1996,
according to MarketWatch, and the Dow
Jones Industrial Average remained within striking distance of 20,000, according
to Yahoo!Finance.
On Friday, President Trump delivered
his inauguration address, but it didn’t resolve the uncertainty that has been
nagging investors. The speech mentioned infrastructure activity, brushed over
stimulus spending and tax cuts, and leaned heavily into protectionism. Mr.
Trump said:
“America will start winning again,
winning like never before. We will bring back our jobs. We will bring back our
borders. We will bring back our wealth. And we will bring back our dreams. We
will build new roads, and highways, and bridges, and airports, and tunnels, and
railways all across our wonderful nation. We will get our people off of welfare
and back to work – rebuilding our country with American hands and American
labor. We will follow two simple rules; buy American and hire American.”
The market response to Friday’s
speech was subdued, according to Financial
Times:
“…with U.S. stocks edging higher,
Treasuries putting in mixed performances and the dollar easing back against its
main rivals. Oil prices rose sharply amid hopes that producers would show
compliance to a global deal to cut output. Gold initially struggled for
traction but held above the $1,200 an ounce mark.”
All major U.S. stock markets
finished the week slightly lower, and 10-year Treasury yields finished the week
slightly higher.
Data as of 1/20/17
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
|
Standard & Poor's 500
(Domestic Stocks)
|
-0.2%
|
1.5%
|
22.2%
|
7.2%
|
11.5%
|
4.8%
|
|
Dow Jones Global ex-U.S.
|
-0.5
|
2.5
|
18.2
|
-2.6
|
2.3
|
-1.1
|
|
10-year Treasury Note (Yield
Only)
|
2.5
|
NA
|
2.0
|
2.8
|
2.0
|
4.8
|
|
Gold (per ounce)
|
0.9
|
3.6
|
9.0
|
-1.5
|
-6.2
|
6.5
|
|
Bloomberg Commodity Index
|
-0.2
|
1.0
|
21.3
|
-10.9
|
-9.0
|
-5.8
|
|
DJ Equity All REIT Total
Return Index
|
0.7
|
0.8
|
18.8
|
11.8
|
11.3
|
4.7
|
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg
Commodity Index returns exclude reinvested dividends (gold does not pay a
dividend) and the three-, five-, and 10-year returns are annualized; the DJ
Equity All REIT Total Return Index does include reinvested dividends and the
three-, five-, and 10-year returns are annualized; and the 10-year Treasury
Note is simply the yield at the close of the day on each of the historical time
periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com,
London Bullion Market Association.
Past performance is no guarantee of future results.
Indices are unmanaged and cannot be invested into directly. N/A means not
applicable.
TREMENDOUS. Awe-inspiring. Groundbreaking.
OVERWHELMING. Those were just a few of the adjectives used to
describe 2017’s Consumer Electronics Show (CES), which showcased all kinds of
new technology. This year, gadgets and gizmos included wall-sized televisions that
are as thin as house keys, computers that scan 2D and 3D objects, and beds that
read biometric clues to warm your feet and reduce snoring. Here are a few
notable trends that captured media attention:
Smart cars. Black Enterprise
reported, “If there was one, star attraction at CES this year, arguably it was
vehicles…Artificial intelligence is the power behind the new crop of
autonomous, assistive vehicles. These cars not only self-drive, they can read
your emotions, make snap decisions in the presence of danger on the road, and
can even tell you about the flora and fauna at your destination site.”
Smarter homes. CNET Magazine
wrote, “For…years, we've been saying the "real" smart home is just
around the corner. But at CES 2017, it finally felt more tangible than ever before…Whether
it's lighting, DVRs, refrigerators, robot vacuums, home security systems,
phones, or cars – to name just a few – the list of stuff you'll be able to
interact with…is set to explode in the coming months. And with such networked
integration now becoming the rule rather than the exception in major appliances…there's
no turning back.”
Even smarter routers. Popular
Science liked a new Wi-Fi router that “…rather than protecting each of your
devices individually…will use…software to protect up to 20 laptops, computers,
tablets, or smartphones – and an unlimited number of IoT devices – in one fell
swoop…You'll be able to monitor…all devices connected to the router, through a
smartphone app…You can even tell the router to turn off internet access to
certain devices – or devices linked to a particular profile – at certain times.
So, you can make sure little Johnny isn't up all night watching YouTube videos
on any of his devices (except for his phone, maybe, but that's your own dang
fault for getting the kid a data plan).”
Of course, trends in technology
are just one American story. Another trend, in some states, is the growing
popularity of rural, sustainable, off-the-grid properties, according to NPR. “Despite the remoteness of these
homes, they're not backwoods shacks with sagging metal roofs. Some… listings
sell for more than $1 million if there's a lot of land and if water rights are
included. The one with the helicopter pad is a spiffy, two-story log home with
a wraparound porch.”
Weekly Focus – Think About It
“When I dare to be powerful, to
use my strength in the service of my vision, then it becomes less and less important
whether I am afraid.”
--Audre Lorde, African
American writer
Best regards,
Warm regards from Eagan,
Leif M. Hagen
Leif M. Hagen, CLU, ChFC
LP Financial Advisor
Securities offered through LPL Financial Inc., Member FINRA/SIPC.
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* This newsletter was
prepared by Peak Advisor Alliance. Peak Advisor Alliance is not affiliated with
the named broker/dealer.
* The Standard & Poor's
500 (S&P 500) is an unmanaged group of securities considered to be
representative of the stock
market in general. You cannot invest directly in this index.
* The Standard & Poor’s
500 (S&P 500) is an unmanaged index. Unmanaged index returns do not reflect
fees,
expenses, or sales charges.
Index performance is not indicative of the performance of any investment.
* The 10-year Treasury Note
represents debt owed by the United States Treasury to the public. Since the
U.S.
Government is seen as a
risk-free borrower, investors use the 10-year Treasury Note as a benchmark for
the long-term bond market.
* Gold represents the
afternoon gold price as reported by the London Bullion Market Association.
The gold price is set twice
daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in
U.S. dollars per fine troy ounce.
* The Bloomberg Commodity
Index is designed to be a highly liquid and diversified benchmark for the
commodity futures market. The Index is composed of futures contracts on 19
physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT
Total Return Index measures the total return performance of the equity
subcategory of the Real Estate Investment Trust (REIT) industry as calculated
by Dow Jones.
* Yahoo! Finance is the
source for any reference to the performance of an index between two specific
periods.
* Opinions expressed are
subject to change without notice and are not intended as investment advice or
to predict future performance.
* Economic forecasts set
forth may not develop as predicted and there can be no guarantee that
strategies promoted will be successful.
* Past performance does not
guarantee future results. Investing involves risk, including loss of principal.
* You cannot invest directly
in an index.
* Consult your financial
professional before making any investment decision.
* Stock investing involves
risk including loss of principal.
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Sources:
https://www.ft.com/content/fe66322a-deb8-11e6-86ac-f253db7791c6 (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/01-23-17_FinancialTimes-Markets_Give_Muted_Response_to_Trump_Speech-Footnote_4.pdf)
