Sign in for Premium Content
If you are a client, sign in below to access premium content.
Stocks ended last week on another strong note as markets surged on the strong possibility that the Fed won’t raise rates this year. For the week, the S&P 500 gained 0.90%, the Dow grew 0.77%, and the NASDAQ rose 1.16%.1
Investors greeted mixed economic data with cheers as it raised hopes that the Federal Reserve will delay hiking rates. We’re back to another round of “bad news is good news” market activity. Investors have exhibited this contrary behavior around key Fed decisions in the past, so it’s no great surprise. Right now, investors are so nervous about rate hikes that they cued into last week’s lackluster data as an indicator that the Fed could delay a rate raise until 2016.
Among the reports that might give the Fed pause was data that showed industrial production slipping for two months in a row, potentially showing that the manufacturing sector is suffering.2 Wall Street economists are also paring back Q3 economic forecasts, expecting to see just 1.7% growth following the second quarter’s strong final reading of 3.9%.3 On the positive side, consumer sentiment rebounded strongly, suggesting that the economy remains strong despite challenges from a strong dollar and weak global growth.4
So far, earnings season has been lackluster. Although we haven’t heard from enough U.S. companies to draw conclusions, reports from heavy-hitters like Wal-Mart [WMT] and Yum Brands [YUM] show that many companies are cautious about growth prospects. Economic developments in China and volatility abroad are making projections difficult, but companies expect challenges to growth to continue.5
This week is light on U.S. economic data, so markets will likely focus on earnings reports and key economic data out of China. Is last week’s rally likely to last? We can hope so, but we’re expecting more volatility as earning season progresses and investors digest fourth-quarter forecasts.
INVESTING RISK DISCLOSURE
Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money. Before investing, consider the funds’ investment objectives, risks, charges, and expenses. Contact Mahoney Asset Management for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.
IMPORTANT CONSUMER INFORMATION
This web site has been prepared solely for informational purposes. It is not an offer to buy or sell any security; nor is it a solicitation of an offer to buy or sell any security.This site and the opinions and information therein are based on sources which we believe to be dependable, but we can not guarantee the accuracy of such information.
Representatives of a broker-dealer or investment adviser may only conduct business in a state if the representatives and the broker-dealer or investment adviser they represent: (a) satisfy the qualification requirements of, and are approved to do business by, the state; or (b) are excluded or exempted from the state’s licenser requirements.
An investor may obtain information concerning a broker-dealer, an investment advisor, or a representative of a broker-dealer or an investment advisor, including their licenser status and disciplinary history, by contacting the investor’s state securities law administrator.
SECURITIES: ARE NOT FDIC-INSURED/ARE NOT BANK-GUARANTEED/MAY LOSE VALUE
This information is intended for use only by residents of CA, CT, DC, FL,, MA, MD, MN, NC, NJ, NY, OH, PA, and VA. Securities-related services may not be provided to individuals residing in any state not listed above.
The financial calculator results shown represent analysis and estimates based on the assumptions you have provided, but they do not reflect all relevant elements of your personal situation. The actual effects of your financial decisions may vary significantly from these estimates–so these estimates should not be regarded as predictions, advice, or recommendations. Mahoney Asset Managment does not provide legal or tax advice. Be sure to consult with your own tax and legal advisors before taking any action that would have tax consequences.