It was nice to see our third up month for the S&P 500 and leading us to more record highs in July. Sometimes this type of complacency can lead to major swings in the markets. This is where a piece of bad news might send the markets down a couple percent. It could be something like the Federal Reserve changing their interest rate stance on cuts, or perhaps a bad trade deal, or maybe even international conflict. Whatever it might be, let’s just remember that we are all in our risk tolerances for a reason. If you ever feel you’re ready for a change, never hesitate to contact us.
There really wasn’t much notable news in July. The S&P 500 was up about 2% for the month. The aggregate bond index was down about a half percent. Of course, those numbers aren’t that boring either! The Fed decided against lowering interest rates, which will definitely sour the market. If you’re looking to deep dive the latest Fed meeting, this was interesting. From here, the market will look for a “bad news is good news” scenario. That means the stock market will start to look at economic and employment data to try to see negatives. For example, if unemployment starts to increase, the stock market will likely see that as a positive sign because it might force the Fed to lower rates soon.
As we enter August, here are a few quick things to look for in stock market news:
- - Any trade deal details with China – markets are counting on good news
- - Monthly employment numbers - remember, bad data might spur a rate drop
- - Geopolitical news – we’re at or near record highs which can be fragile
Have a great August! Thanks for being here with us.
Larry Mroczkowski
President
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. All investing involves risks, including the loss of principal.