Archive for category: Market Commentary

When it comes to investing, it’s best served to check your biases at the door and simply follow the facts.  Contrary to conventional belief, U.S. equities have been historically calm over the past few months while other global equity markets have been extremely volatile.  

School is out for summer and all of the important grades have been locked in for the first half of 2018. The most recent earnings season grade for corporate America was an “A” as profit growth amongst S&P 500 companies was higher than any time since 2011 and nearly 75% of the stocks in the index beat their estimates, with a boost from lower tax bills. U.S. household wealth surpassed $100 trillion earlier this year for the first time, which means households have nearly doubled their net worth from the low in 2009. And with unemployment dropping to 3.8%, there are now more job openings than bodies prepared to fill them.

Four percent drops in the stock market, while somewhat rare, aren’t that unusual. What’s unusual are extended market rallies with little to no drawdowns and non-existent volatility. That was the experience in the stock market throughout 2017 and it was an aberration, not the norm. Don’t let anyone ever fool you otherwise.