Hixon Zuercher Capital Management
Fee-only Registered Investment Advisor in Findlay, Ohio 45840
Major U.S. stock benchmarks eked out slight gains last week, with corporate profit reports and news about U.S.-China trade negotiations vying for investor attention over five trading sessions.
The big three ended the week little changed from where they settled the previous Friday. The Dow Jones Industrials rose 0.17% percent, while the S&P 500 Index gained 0.05% percent. The NASDAQ Composite ended the week up 0.47%. Looking at international stocks, the MSCI EAFE index retreated 0.47%.
As of last Friday, 66% of all S&P 500 companies had reported fourth-quarter earnings. So far, 71% of these firms have announced earnings exceeding estimates, and 62% have seen revenues top projections.
Halfway through earnings season, 2019 future guidance has been a mixed bag for S&P 500 companies. For Wall Street, future earnings can be just as important as current earnings. We keep a close eye on both.
March 1 is the 90-day deadline set by President Trump for a trade deal with China. If no agreement is reached, the U.S. may consider a new round of tariffs. On Thursday, news that President Trump and Chinese President Xi may not meet before the March 1 deadline added to the market volatility.
The decision by the U.S. on new tariffs may hinge on how much progress has been made toward a new agreement. We don’t expect that to become clear until the deadline nears.
Many indicators help economists take the pulse of the overall economy. The Institute for Supply Management keeps a critical, but not widely followed, index, which helps gauge the health of the service sector.
The January reading on this index came in at 56.7. Any reading above 50 shows that the service industry is seeing solid growth.
Over the next several weeks, we’re expecting more volatility as the markets digest economic news, a new wave of corporate earnings, and twists and turns on the geopolitical front. We will be watching to see if anything changes our short-term and long-term view. If you have any questions, don’t hesitate to contact us.
Wednesday: January’s Consumer Price Index, which measures monthly and yearly inflation.
Thursday: December retail sales figures (a delayed release due to the government shutdown).
Friday: January’s preliminary University of Michigan consumer sentiment index, a gauge of consumer confidence levels.
Monday: Loews Corp (L)
Tuesday: Activision Blizzard (ATVI), HubSpot (HUBS), Occidental Petroleum (OXY)
Wednesday: Cisco (CSCO), Hilton Worldwide Holdings (HLT), Yelp (YELP)
Thursday: Applied Materials (AMAT), CBS (CBS), Coca-Cola (KO)
Friday: Deere & Co. (DE), PepsiCo (PEP)
In this video, I will discuss how the end of 2018 turned out, and how the major market events of December could have an effect on you as an investor.
If you have any questions about your portfolio or financial situation after viewing this video, please give us a call at (419) 425-2400, or send us an email at hello@hzcapital.com. We would love to talk with you.
We are very excited to finally reveal our BRAND NEW office to you all. Join Adam, Tony, and Kelsey Heitkamp, owner and principal designer with KHID, as they take us through a tour of the new space and showcase their favorite parts of the office.
So much time and hard work were spent by numerous people over this last year to make this happen, and we couldn’t be more pleased with the finished product.
We are incredibly grateful to every person who had a hand in helping us bring our vision to life in creating the best space we could have to further serve our clients throughout the coming years.
Special thanks to:
KHID
Heck Rentals
Garlock Brothers Construction
JB Networks Inc
Gina Lynne Design
Stock performance was mixed last week as investors considered the impact of interest rates, international affairs and corporate earnings. The S&P 500 gained 0.02%, and the Dow added 0.41% to post its first weekly gains in October. The NASDAQ declined 0.64% and extended its losing streak. International stocks in the MSCI EAFE dropped by 0.08%.
While the final weekly results showed relatively little growth or loss, the week included some volatility. So far, domestic indexes have struggled this month. As of October 19, the S&P 500 and Dow had each lost more than 3% for the month, and the NASDAQ was down 7%.
As we have often discussed in our market updates, volatility may feel uncomfortable, but market fluctuations are normal. That perspective becomes especially relevant in October, which is considered the most volatile month for markets.
Historical performance can’t predict future results. However, we do believe that understanding what makes October unique can help provide context for the current environment.
Exactly how this month will end remains to be seen, as we still have a few trading days left. But we hope that understanding how much markets often move in October will help you ride out any future volatility with more confidence. Of course, we’re also here to provide any answers or information you need, so contact us any time.
Wednesday: New Home Sales
Thursday: Durable Goods Orders, Jobless Claims
Friday: GDP, Consumer Sentiment
