“Peek of the Week”
Market Commentary
July 15, 2019
The Markets
The bulls are running.
Last week, the Standard &
Poor’s 500 Index set a new record, closing above 3,000 for the first time.
Other major U.S. stock indices also finished at record highs, reported Barron’s.
Company fundamentals,
investor sentiment, and geopolitics all have the power to push stock prices
higher. However, according to Financial
Times, last week’s gains were attributed to Federal Reserve Chair Jerome
Powell’s testimony before Congress and the expectation the Federal Reserve will
lower the Fed funds rates in July.
Financial Times
reported:
“Mr.
Powell laid out the case for monetary easing by highlighting some softness in
indicators such as business fixed investment and persistently low inflation.
But mostly, he stressed the impact of uncertainty stemming from trade tensions,
weak global growth, the possibility that the U.S. Congress fails to raise the
debt ceiling, and a no-deal Brexit.”
Investors were encouraged by
the possibility of monetary easing. Yardeni
Research charted data showing the Investors Intelligence bull/bear ratio rose
to 3.1 on July 9. It was 2.94 on June 25 and 3.05 on July 2, which indicates
bullishness has been increasing.
An Investors Intelligence
bull/bear ratio greater than 1 typically indicates high levels of bullishness,
while a bull/bear ratio of less than 1 typically indicates high levels of
bearishness. The ratio generally is considered a contrarian indicator,
explained Investing Answers.
Year-to-date, the Standard
& Poor’s 500 Index is up 20.2 percent.
Data as of
7/12/19
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
Standard &
Poor's 500 (Domestic Stocks)
|
0.8%
|
20.2%
|
7.7%
|
11.9%
|
8.8%
|
12.8%
|
Dow Jones Global
ex-U.S.
|
-0.6
|
11.5
|
-2.3
|
5.9
|
0.0
|
4.7
|
10-year Treasury
Note (Yield Only)
|
2.1
|
NA
|
2.9
|
1.5
|
2.6
|
3.4
|
Gold (per ounce)
|
1.4
|
9.8
|
13.0
|
1.6
|
1.5
|
4.5
|
Bloomberg Commodity Index
|
2.4
|
5.6
|
-3.6
|
-2.5
|
-9.1
|
-3.4
|
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; 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, MarketWatch, 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.
an auction the yelnats would appreciate. Sneakers play an important role in the film Holes. Stanley Yelnats IV is arrested
for stealing a pair and his father, Stanley Yelnats III, spends his time trying
to invent a cure for sneaker odor.
The Yelnats would probably be
interested in an upcoming Sotheby’s auction which features 100 pairs of rare
sneakers. You see, sneakers have become collectibles, like fine art.
The Wall Street Journal explained, “Collecting limited-edition sneakers has
evolved from the past time of a loopy subculture to a booming mainstream
passion.”
Collectors of fine sneakers
are known as sneakerheads. During the Sotheby’s auction, they’ll have
opportunities to invest in:
· A pair of
sneakers handmade for the 1972 Olympic trials, featuring a waffle tread
inspired by the designer’s wife’s waffle iron.
·
Two pairs “…inspired
by Marty McFly's kicks in Back to the Future Part II. Both pairs were
part of limited releases, originally sold to benefit The Michael J. Fox
Foundation for Parkinson's Research.”
·
A pair of sneaks
produced “…in collaboration with famed fashion house Chanel. The shoe released
only at a special Chanel pop-up shop at Colette in Paris in extremely limited
quantities…”
·
2017’s sneaker of
the year, which the auction catalogue touted as a “…shoe absolutely everybody
wants but few can get.”
·
A pair “…released
exclusively in NYC at the Museum of Modern Art [MoMA]. All pairs sold out
almost instantly at MoMA on January 27 at the shoe's only release. This design
is truly a work of sneaker art.”
In case you’re wondering, the
starting bid for the handmade Olympic sneakers is $80,000.
Even if you don’t find
sneakers lovely, and wouldn’t display them above the fireplace in your living
room or mount them in your trophy room, you may want to check your closets for
collectibles.
Weekly Focus – Think About It
“Collecting facts is
important. Knowledge is important. But if you don't have an imagination to use the
knowledge, civilization is nowhere.”
--Ray Bradbury, American author
Best regards,
Leif
M. Hagen
Leif M. Hagen, CLU, ChFC
LPL Financial Advisor
Contact us at 651-209-6350
Leif M. Hagen, CLU, ChFC
LPL Financial Advisor
Contact us at 651-209-6350
P.S. Please feel free to forward this commentary
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Securities
offered through LPL Financial, Member FINRA/SIPC.
*
These views are those of Carson Coaching, and not the presenting Representative
or the Representative’s Broker/Dealer, and should not be construed as
investment advice.
*
This newsletter was prepared by Carson Coaching. Carson Coaching is not
affiliated with the named broker/dealer.
*
Government bonds and Treasury Bills are guaranteed by the U.S. government as to
the timely payment of principal and interest and, if held to maturity, offer a
fixed rate of return and fixed principal value.
However, the value of fund shares is not guaranteed and will fluctuate.
*
Corporate bonds are considered higher risk than government bonds but normally
offer a higher yield and are subject to market, interest rate and credit risk
as well as additional risks based on the quality of issuer coupon rate, price,
yield, maturity, and redemption features.
*
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.
*
All indexes referenced are unmanaged. Unmanaged index returns do not reflect
fees, expenses, or sales charges. Index performance is not indicative of the
performance of any investment.
*
The Dow Jones Global ex-U.S. Index covers approximately 95% of the market
capitalization of the 45 developed and emerging countries included in the Index.
*
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 Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an
index representing 30 stock of companies maintained and reviewed by the editors
of The Wall Street Journal.
*
The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ
system.
*
International investing involves special risks such as currency fluctuation and
political instability and may not be suitable for all investors. These risks
are often heightened for investments in emerging markets.
*
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.
*
Stock investing involves risk including loss of principal.
* The foregoing information has
been obtained from sources considered to be reliable, but we do not guarantee
it is accurate or complete.
*
There is no guarantee a diversified portfolio will enhance overall returns or
outperform a non-diversified portfolio. Diversification does not protect
against market risk.
*
Asset allocation does not ensure a profit or protect against a loss.
*
Consult your financial professional before making any investment decision.
*
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Sources:
https://www.barrons.com/articles/dow-major-ndexes-sett-record-ford-volkswagen-china-trade-outflows-51562964799 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/07-15-19_Barrons-The_Dow_S_and_P_500_and_Nasdaq_Set_Records_Yet_Investor_Sentiment_is_Low-Footnote_1.pdf)
https://www.ft.com/content/ed3fe53c-a444-11e9-974c-ad1c6ab5efd1 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/07-15-19_FinancialTimes-US_Stocks_Reach_New_Highs_as_Spotlight_Remains_on_Fed-Footnote_2.pdf)
https://www.ft.com/content/7e69f980-a364-11e9-974c-ad1c6ab5efd1 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/07-15-19_FinancialTimes-Federal_Reserves_Dovish_Tilt_Stirs_Debate_on_How_Far_It_will_Go-Footnote_3.pdf)
https://www.yardeni.com/pub/peacockbullbear.pdf (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/07-15-19_Yardeni_Research-Investors_Intelligence_Sentiment-Footnote_4.pdf)
https://www.brainyquote.com/quotes/ray_bradbury_626618?src=t_collectingPhoto by Edgar Chaparro on Unsplash
