Last week, all four of the indexes we discuss in these market updates saw their performance stumble. The S&P 500 lost 1.44%, the Dow was down 1.52%, the NASDAQ gave back 1.22%, and the MSCI EAFE declined 0.07%.
On Tuesday, March 21, the S&P 500 and Dow recorded 1% declines for the first time since Oct. 11, 2016. By Friday, the S&P had posted its worst week since the election. At the same time, 10-year Treasury yields fell and the dollar dropped for the second straight week.
As is typically the case, no simple answer can easily explain market behavior. Last week’s healthcare headlines – and the House of Representatives’ decision not to vote on the American Health Care Act of 2017 – may have caught the attention of many people on Wall Street. As a result, pundits will likely spend significant time debating what lies ahead for health care, tax reform, and other governmental policies. We again encourage you to look at the economic fundamentals rather than allowing news coverage to determine your financial confidence.
Recent Economic News
We did not receive a tremendous amount of new data between March 20 and 24, but three new reports did stand out: Durable Goods, New Single-Family Home Sales, and Existing Home Sales.
Durable goods orders increased 1.7%.
Orders for durable goods (items expected to last) beat expectations in February and are up 5% since this time last year. While commercial aircraft orders accounted for a significant portion of the increase, data throughout the report may indicate that business investment and confidence is on the rise.
New single-family home sales increased 6.1%.
In February, sales of new single-family homes hit their second-fastest growth since 2008. Even as home prices and mortgage rates rise, demand for new homes has grown by 12.8% in the past 12 months.
Existing home sales dropped 3.7%.
Coming off of January, where we saw the fastest pace of existing home sales since 2007, the report missed expectations in February. Low inventory of available houses is pushing prices higher and may be keeping some potential buyers from moving forward. In the past year, median prices have risen 7.7%; meanwhile, sales are 5.4% higher.
This week, we will receive the Q4 GDP final reading, as well as insight into personal income, consumer sentiment, and consumer confidence. This and other forthcoming data provides the foundation necessary for clearly understanding the economic environment.
We understand how compelling the news and political conversations can be, and there is no denying that policies can affect the economy. However, we are here to help you gain the perspectives you need to know where you stand in your unique financial life – rather than what the headlines may urge you to believe.
Tuesday: Consumer Confidence, International Trade in Goods
Wednesday: Pending Home Sales Index
Friday: Personal Income and Outlays, Consumer Sentiment
Quote Of The Week
“Be brave. Take risks. Nothing can substitute experience.” – Paulo Coelho
Recipe Of The Week
Toasted Spaghetti With Clams
Enjoy the toasted flavor of this simple pasta dish!
3 tablespoons extra virgin olive oil
¾ pounds of spaghetti, broken into 2-inch pieces
2 garlic cloves, minced
crushed red pepper
3 cups bottled clam broth
1 cup water
3 dozen littleneck clams, rinsed
¼ cup flat-leaf parsley, minced
Heat olive oil until it shimmers in a large skillet over medium heat.
Add the raw spaghetti pieces and sauté, stirring constantly until golden (about 3 minutes).
Toss in minced garlic and a large pinch of the crushed red pepper. Cook until they become fragrant (about 1 minute).
Add the water and clam broth, and bring the mixture to a boil.
Cover the skillet with a lid, and cook until the noodles are just al dente (around 8 minutes).
Add the clams to the skillet, nestling them so they are snug within the pasta.
Cover the skillet again and cook until the pasta is al dente and clams open (about 7 minutes).
Finishing Touches – Before Serving:
Liven up the pasta with a few tablespoons of water if it’s slightly dry from cooking.
Top pasta dish with minced parsley and enjoy.
Recipe adapted from Food and Wine
Tax Benefits of Higher Education
Pursuing higher education can provide you with tax benefits that help offset the money you owe if either you, your spouse, or your dependents attended in 2016. You have two credits available: 1) American Opportunity Credit and 2) Lifetime Learning Credit. Here are tips for knowing if these credits apply to you and how to claim them.
American Opportunity Credit
For: Students who actively pursued a degree or another recognized college credential at least part time and for a minimum of one academic period in 2016
Worth: Benefit maximum is $2500 per student
Time Limit: Only applicable during first four years of attendance at an eligible college or vocational school
Lifetime Learning Credit
For: Students who pursued any postsecondary education, including courses taken to acquire or improve job skills
Worth: Benefit maximum is $2000 per tax return, no matter how many students in your household can claim this credit
Time Limit: No limit on the number of years you can claim this credit
Other qualifying factors may apply, and you can learn more on the IRS website. When filing taxes, claim your credits using Form 8863.
*This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.
Tip courtesy of IRS.gov
Improve Your Game by Training Your Brain
Being mentally sharp during golf is just as important as the mechanical aspects of your game. When your mind isn’t clear – or you’re distracted – an extraordinary shot can easily turn into a dud. You can sharpen your game by training your brain to focus. Here are a couple of tips for bringing the right headspace to the course.
1. Focus Your Attention
When you are taking a shot, your mind digests the movements you plan to make and then tells your body what to do. Having clarity and confidence as you swing is essential for maintaining fluid control. If you’re unsure or feel tentative about your decision, then you’ll probably bring a different tempo to your swing – and miss the opportunity to play your best.
Learn to remain present in the moment. Don’t consume your mind with thinking about what you did before or what you’ll do after this hole. Instead, keep your attention on what you need to do now.
2. Look at Moves in Reverse
Sometimes, looking from the starting point of a move can keep you stuck on what to do next. Planning your approach at the tee box gives you multiple steps and potential scenarios and outcomes to consider. You can train your brain to sharpen its focus by thinking first about the last step of your move.
Work in reverse by imagining sinking the putt and consider each shot that got you there. Visualize each move and how they connect to one another. If you feel confident with this visual play, then go ahead and bring it to life.
Tip courtesy of THINQ Golf & Golf Tips Magazine
Self-Care Tips for Managing Anxiety
Having an anxiety disorder or trouble managing anxiety can require medical care. However, certain lifestyle choices also may help keep anxiety under control. Here are some self-care tips to help you manage your anxiety, regardless of whether you take medication to assist you.
Quit or Avoid Cigarettes and Caffeinated Beverages: Nicotine and caffeine can increase anxiety levels. Decreasing or completely avoiding these can help decrease your anxiety.
Write Daily Logs in a Journal: A journal can be helpful for tracking your daily activities and moods as an ongoing log of your emotional health. Both you and any therapist you may be seeing can use these insights to gain a deeper understanding of the stresses and anxiety triggers you are experiencing in your life.
Eat Healthier Foods: Studies have shown a possible link between healthy eating and decreased anxiety levels. You can support your preventive care by eating more fruits, vegetables, whole grains, and fish.
Socialize: Staying isolated doesn’t improve anxiety. Make sure you spend time with friends and family, and make socializing part of your mental health routine.
Tip courtesy of Mayo Clinic
Ways to Buy Sustainable Seafood: Fish
Your food-shopping habits can support your green living goals. One important factor worth paying attention to is how you buy your seafood – and specifically knowing how to make sustainable choices. Consider these two green tips the next time you’re buying fish to bring home for dinner.
1. Know the Source
Knowing where your fish comes from can help you answer important sustainability questions, such as: Do their fishing practices accidentally catch other animals? Are the fish harvested ethically in relation to their population numbers? You’ll want to identify details, including:
Are the fish wild or farmed?
What are their fishing methods?
How abundant are the fish populations?
The Monterey Bay Aquarium Seafood Watch provides helpful resources for navigating many of these consumer questions.
2. Buy Local Seafood
Whenever you buy local food, you minimize the amount of shipping needed to get you the fish you want – which is usually energy extensive. Plus, you support your local fishing communities while buying food that is typically less expensive and has more abundant populations.
You can explore sustainable fish options by state through the Seafood Watch guide.
Tip courtesy of U.S. News
Share the Wealth of Knowledge!
Please share this market update with family, friends, or colleagues. We love being introduced!
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
Diversification does not guarantee profit nor is it guaranteed to protect assets.
International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.
The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.
The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indices from Europe, Australia and Southeast Asia.
The S&P/Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate. The index is made up of measures of real estate prices in 20 cities and weighted to produce 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.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
Featured Image Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, S&P Dow Jones Indices and Treasury.gov. International performance is represented by the MSCI EAFE Index. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative, Broker dealer or Investment Advisor, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer or Investment Advisor gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.
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