U.S. Capital Market Review 1/5/18
The short week resulted in a strong start to 2018 for the US capital markets with the all major averages advancing and hitting new highs. The much anticipated milestones of 25,000 for the Dow Jones Industrial Average and 7,000 for the NASDAQ were achieved this last week. Gains were mostly attributable to general factors such as a strong close to Q4, economic strength, and an optimistic outlook, as opposed to specific events. The VIX ended in the low 9s, and consumer confidence remains high.
As most on this platform would know, cryptocurrencies had a strong week as well, with many altcoins really thriving, including some lesser known ones like Stellar and Tron. 2017 was a game changing year for the adoption of cryptocurrencies into mainstream discussion, and 2018 looks to be poised for big gains and more mass adoption.
Gold had a strong week, advancing nearly 1% to a strong price of $1,320 an ounce. This was primarily spurred on by a weakness in the US Dollar.
In political news, President Trump and Republicans are now talking about a new infrastructure spending plan, which would further bolster the economy, with the first proposal anticipated in mid-February. President Trump was particularly active on Twitter with more unusual tweets then normal including more nuclear war posturing, causing renewed discussions about his mental capacity to serve as President. Should this gain momentum, the uncertainty of the situation would likely cause severe market volatility.
Overall, I am cautiously optimistic about 2018, and remain fully invested.
Good luck,
Brian
I think the U.S. economy can hasten its pace of growth a bit more this year, though don’t expect it to hit full stride. Employment conditions will remain central to the story, with the unemployment rate likely to dip below 4% for the first time in 17 years. Job growth should continue, but wage growth will likely become the key measure as diminished labor market slack should begin to push wages higher from their sluggish pace to this point in the expansion. This will be central to household spending - the lion’s share of U.S. GDP. A lift in business investment would be a welcome catalyst for economic growth, which should see a modest tailwind from newly minted tax reform. Tax-reform expectations were high, but now the proof will be in the pudding. I believe slightly faster GDP growth should allow the bull market to put another year in the win column, as recession signals still appear faint, and recessions are a typical ingredient for bear markets.
Great points... personally, I think we will begin a recession and bear market in 2019.
VIX at $9 is bananas!
Oil at 3 year highs
DXY below $92
If this doesn't signal that stuff is out of whack and going to get crazy, not sure what does.
Still bullish myself, ironically.
So 2yrs ago I started paying more attention to my 401k so we swapped “companies” who our 401k was underI took a 10% loss instantly... by the end of that year I got I to -4.5%, and the end of last year I ended at +7.9% which I feel really good about since I’m pretty much managing it on my own and Bein only 27 I’m still really new to it... I can’t wait to see how I do this year.... I wish there was more I could invest in outside my 401k tho but with having 3kids And a stay at home wife money is good but not good enough to adventure out and get into more investing a lot.... so do any of u have any helpful tips as far as something I could slowly invest maybe 10$ a week into?
Every little bit saved helps. If I was you, I would keep adding to the 401k and not worry too much about other investing. Get debt free if you aren’t already, aside from your home mortgage. Adding small amounts to cryptocurrencies could pay off big for a relatively small investment but carries higher risk so I wouldn’t invest anything you can’t afford to lose. If you really wanted to do some investing to get exposure to the markets, you could setup an automatic investment plan into an S&P 500 tracking ETF or Mutual Fund and probably get around trade commissions. Good luck and congrats on doing well enough to support a family of 5... well done, and that is a much more important thing compared to feeling like you need to do more investing!
I’m still contributing 8% weekly into my 401k and every year I increase it 1%..., we r shooting to be completely debt free by 2020 that includes house, any credit cards or loans, and car payment, as long as we stick to the budget we should be able to do that, and thanks although I make the money if it wasn’t for my wife budgeting us, we probably would be struggling, I think after tax time I’m gonna did my feet into investing into some crypto currency, without risk there’s no reward right? Can’t win if u don’t try 😜
It is great that you have goals and plans and you and your wife are on the same page.. best of luck to you!
Sound logic, thanks for those valuable information @brian.rrr
2018 is just beginning and we already see good indices.