Month: October 2019

Market Perspective for October 18, 2019

Equities extended their winning streak this week. The Russell 2000 Index returned 1.57 percent, the S&P 500 Index 0.56 percent and the Nasdaq 0.43 percent.

Healthcare was the best performing sector, followed by financials and consumer discretionary. SPDR Healthcare (XLV) climbed 2.03 percent, SPDR Financials 1.57 percent and SPDR Consumer Discretionary (XLY) 1.33 percent on the week. Healthcare providers, specifically drug distributors, boosted the healthcare sector. iShares U.S. Healthcare Providers (IHF) rallied 5.76 percent on the week, with some companies rising double-digits.

Strong bank earnings boosted the financial sector. SPDR S&P Bank (KBE) and SPDR S&P Regional Banking (KRE) advanced 2.18 percent and 2.07 percent, respectively. Shares of JPMorgan (JPM) climbed nearly 4 percent on the week, Bank of America (BAC) more than 5 percent.

The Dow Jones Industrial Average slipped 0.15 percent on negative headlines for Johnson & Johnson (JNJ) and Boeing (BA). JNJ recalled baby powder contaminated by a trace amount of asbestos, well below regulatory limits. Boeing slid after the FAA said it found internal messages suggesting employees misled government regulators investigating the 737 MAX.

Economic data was mixed. Homebuilder confidence spiked to a near 2-year high. Housing starts and building permits came down from August highs. Jobless claims remained near all-time lows adjusted for population.

September retail sales missed with a decline of 0.3 percent. Retail sales ex-autos fell 0.1 percent. This comes a week after the University of Michigan said its advance survey of consumer confidence spiked in October. It’s likely the sales number could be revised.

The Fed’s balance sheet expansion plan lifted yields and sent long-term government bonds lower. Corporate, floating-rate and investment grade bonds rallied. Invesco Senior Loan (BKLN) rallied 0.49 percent, iShares iBoxx High Yield Corporate Bond (HYG) 0.38 percent and Fidelity Corporate Bond 0.27 percent.

The U.S. Dollar Index declined 1.00 percent due to a possible Brexit deal. The British pound advanced 2.20 percent with a vote in Parliament scheduled for Saturday.

iShares MSCI United Kingdom (EWU) climbed 1.12 percent on the week and iShares MSCI EAFE (EFA) returned 1.13 percent. iShares MSCI Emerging Markets (EEM) returned 0.58 percent.

 

The Investor Guide to Vanguard Funds for October 2019

The Investor Guide to Vanguard Funds for October is AVAILABLE NOW! Links to the October data files are posted below. Market Perspective: Interest Rate Cuts Should Boost Stocks The U.S. […]

To access this post, you must purchase Investor Guide to Vanguard Funds – 1 Year, Online Only - Emailed Directly to Your Inbox, Investor Guide to Vanguard Funds – 2 Year, Online Only - Emailed Directly to Your Inbox, Investor Guide to Vanguard Funds – 3 Year, Online Only - Emailed Directly to Your Inbox, Investor Guide to Vanguard Funds – 1 Year, Print - Delivered Each Month via USPS, Investor Guide to Vanguard Funds – 2 Year, Print - Delivered Each Month via USPS or Investor Guide to Vanguard Funds – 3 Year, Print - Delivered Each Month via USPS.

Market Perspective for October 14, 2019

Equities traded sideways on Monday. Investors digested last week’s trade news and the Federal Reserve’s balance sheet expansion plans. The S&P 500 Index fell 0.14 percent on the day.

Financial stocks were solid on the day as traders bet on a strong earnings season starting tomorrow. SPDR Financial (XLF) gained 0.14 percent. Materials were the weakest sector, with SPDR Materials (XLB) falling 0.71 percent.

September retail sales will be out on Wednesday. Economists forecast an increase of 0.3 percent.

The homebuilders confidence index for October is out this week, along with housing starts and building permits for September. iShares U.S. Home Construction (ITB) has rallied 12.1 percent over the past two months, buoyed by lower interest rates, low unemployment, rising wages and positive surprises in housing data.

Earnings will dominate this week as reporting season hits full swing. On Tuesday, mega banks JPMorgan (JPM), Wells Fargo (WFC), Citigroup (C) along with Goldman Sachs (GS) and Blackrock (BLK) will report before the bell. Healthcare giants Johnson & Johnson (JNJ) and UnitedHealth Group (UNH) will deliver results as well. Communication services bellwether Netflix (NFLX) will report after the bell.

On Wednesday, Bank of America (BAC), PNC Financial Services (PNC), U.S. Bancorp (USB) and Progressive (PGR) continue the early wave of major financial reports. International Business Machines (IBM), Alcoa (AA) and Abbott Laboratories (ABT) and Steel Dynamics (STLD) also announce.

Thursday brings major transports component Union Pacific (UNP), Morgan Stanley (MS), Phillip Morris International (PM), Honeywell (HON), Intuitive Surgical (ISRG), Danaher (DHR) and homebuilder NVR Inc. (NVR). Regional banks such as BB&T (BBT), KeyCorp (KEY) and SunTrust Banks (STI) are also in the mix.

This week’s reports end with Coca-Cola (KO), the largest oil services firm Schlumberger (SLB), American Express (AXP), transports component Kansas City Southern (KSU), plus more financials such as Synchrony (SYF), Citizens Financial Group (CFG) and State Street (STT).

The U.S. Dollar Index rebounded in Monday’s light trading, rising 0.30 percent. Crude oil fell a little more than $1 per barrel. iShares MSCI Emerging Markets (EEM) slipped 0.43 percent, iShares MSCI EAFE (EFA) 0.41 percent. The 10-year yield slipped to 2.20 percent.