Markets “In a Nutshell” for May 21, 2019

Investment Week at a Glance

Stocks mostly dropped last week. The Dow Jones Industrial average fell 0.7% while the S&P 500 was down 0.8%. The New York Stock Exchange Composite (2,000 stocks) lost 1.0%. The “average investor’s index” (Value Line index) declined 2.2%. Foreign stocks (DJ Global ex U.S.) inched up 0.2%. Bond yields dropped (bond prices up) as the 10 year Treasury ended at 2.39%. (Data sources: Barron’s Financial, Wall Street Journal)

U.S. stocks in a bear market?…

While most analysts believe U.S. stocks are still in a bull (upward moving) market there are a few dissenting voices. Most prominent is Jeffrey Gundlach, founder of the $123 billion Doubleline Capital. Gundlach believes that the bear market started in late 2017 when the mania in Bitcoin was at its peak. He sees weakening economic data as further sign.

…Or are U.S. stocks in a long term bull market?

BMO Capital Markets Group CIO Brian Belski believes U.S. stocks are only halfway through a 25 year rising market for stocks. Belski said in 2009 we hit a generational low and started what is called a “secular” (latin for “long time”) bull market that would last for 25 years. “We’re going to have a pause here and there, but this is very, very normal and very healthy,” he said.

Barron’s says keep calm about the trade war with China

The trade tariffs (trade war) between the U.S. and China have dominated the headlines the past couple weeks. Stocks have been moving up and down in reaction to the seemingly hour by hour change in trade headlines. But for all the fears Barron’s tells investors to keep calm and not panic. Barron’s sees continued stock market volatility for a short time but sees the Federal Reserve acting as a backstop to a major stock decline.

Quiz:

According to the Bureau of Labor Statistics, 9 states have reported all time low unemployment rates as of March 31, 2019. Which of the following states had the lowest unemployment rate at 2.4%?

a. South Carolina

b. Hawaii 

c. Pennsylvania

d. Vermont

Answer is below…

 

Have a good week!

 

Answer to quiz:

d. Vermont