Weekly Market
Commentary
The Markets
How much is too much?
There
has been no shortage of drama since the new administration took office – legislative
setbacks, controversial hiring and firing, and fiery tweets on various topics. Regardless,
U.S. investors and markets remained stalwart until last week when the CBOE
Volatility Index (a.k.a. the fear gauge) jumped 46 percent higher and markets
declined.
Financial
Times explained:
“…a
range of stock benchmarks made their biggest single-day fall since November, as
the political controversy over Donald Trump ties with Russia undermined
investors’ faith in the administration’s ability to enact its pro-growth
policies. Markets subsequently steadied, but investors are primed for further volatility
as the White House faces the distraction of a lengthy inquiry led by an
independent special counsel.”
Markets
recovered some ground late in the week as the influence of Washington, D.C.
drama was offset by strong earnings news. On Friday, FactSet reported first quarter earnings results were in for 95
percent of the companies in the Standard & Poor’s 500 (S&P 500) Index and
75 percent had beaten estimates. Altogether, corporate earnings were about 6.0
percent higher than expected.
Earnings
performance was particularly strong for companies in the Information
Technology, Healthcare, and Financials sectors, and relatively weak for companies
in the Telecom Services, Real Estate, and Consumer Staples sectors.
Brace
yourself. Next week may be bouncy. The Federal Reserve Open Market Committee will
release minutes from its most recent meeting. In addition, we’ll receive the
administration’s proposed budget, along with new economic data and consumer
sentiment readings.
Data as of
5/19/17
|
1-Week
|
Y-T-D
|
1-Year
|
3-Year
|
5-Year
|
10-Year
|
Standard & Poor's 500 (Domestic Stocks)
|
-0.4%
|
6.9%
|
16.8%
|
8.1%
|
12.6%
|
4.6%
|
Dow Jones Global ex-U.S.
|
0.4
|
11.9
|
17.9
|
-0.3
|
5.8
|
-1.1
|
10-year Treasury Note (Yield Only)
|
2.2
|
N/A
|
1.9
|
2.5
|
1.7
|
4.8
|
Gold (per ounce)
|
1.7
|
8.0
|
-0.1
|
-1.3
|
-4.7
|
6.6
|
Bloomberg Commodity Index
|
1.5
|
-3.2
|
0.1
|
-14.5
|
-9.0
|
-7.0
|
DJ Equity All REIT Total
Return Index
|
1.4
|
2.6
|
7.7
|
8.8
|
10.8
|
5.5
|
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.
Are you helping your adult children
financially? In 2015, Pew Research investigated whether aging parents
received more assistance from adult children or adult children received more
assistance from parents. In the United States, Italy, and Germany, they found
parents provide more financial assistance to their adult children than the
adult children provide to their parents.
The
survey found 39 percent of American parents had helped their adult children with
errands, housework, or home repairs during the past twelve months, and 48 percent
had helped with childcare. Almost two-thirds had provided monetary support.
Financial help appeared to be contingent on parents’ circumstances. Those with
higher household incomes were more likely to give money to adult children.
Becoming
the ‘Bank of Mom and Dad’ can be a slippery slope, according to AARP Magazine. Since parent-child
relationships can be emotionally fraught, it’s sometimes difficult to gauge
when financial assistance is a good idea and when it’s not. Should you pay for
a car repair? Help with the down payment on a home or apartment? Foot the bill for a grandchild’s private
school or college? Fund a lavish wedding? Help with medical bills?
The
AARP suggested answering four
questions, using a scale of 0 to 5, may help parents determine whether to give
money to an adult child. The questions are:
2. Is this a short-term or one-time cash need, or is it something that could go on for years? (0 = guaranteed, long-term payouts; 5 = absolutely just one time)
3. Is there risk in the investment beyond the cash
outlay, such as financial liability on a contract or damage to your credit? (0 = very high levels of risk; 5 = no
additional risks)
4. Can you lend or give this money without fear of
damaging your relationship with your child? Or, will it cause tensions or
resentments for the people involved? (0 = guaranteed tensions or resentments; 5
= everyone is happy)
If
the combined answers total 13 or higher, the answer is yes, give money to your
adult child. If the total is less than 13, you may want to think twice before opening
your wallet.
Weekly
Focus – Think About It
“Life is to be
lived, not controlled; and humanity is won by continuing to play in face of
certain defeat.”
--Ralph
Ellison, American author of ‘Invisible Man’
Best regards,
Womack
Investment Advisers, Inc.
WOMACK INVESTMENT ADVISERS, INC.
Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK 73013
California Office: 4660 La Jolla Village Dr., Ste. 500 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717
Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK 73013
California Office: 4660 La Jolla Village Dr., Ste. 500 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717
Website: www.womackadvisers.com
P.S. Please feel free to forward this commentary
to family, friends, or colleagues. If you would like us to add them to the
list, please reply to this e-mail with their e-mail address and we will ask for
their permission to be added.
*
These views are those of Peak Advisor Alliance, and not the presenting
Representative or the Representative’s Broker/Dealer, and should not be
construed as investment advice.
*
This newsletter was prepared by Peak Advisor Alliance. Peak Advisor Alliance 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
indices 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 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.
*
To unsubscribe from the Womack Weekly Commentary please reply to this e-mail
with “Unsubscribe” in the subject line, or write us at
raegan@womackadvisers.com
Sources:
https://www.ft.com/content/83968832-3c42-11e7-821a-6027b8a20f23 (or go to https://s3-us-west-2.amazonaws.com/peakcontent/+Peak+Commentary/05-22-17_FinancialTimes-Global_Stocks_Rally_After_Midweek_Slide-Footnote_1.pdf)
Comments
Post a Comment