Market Commentary, 04/02/19

The Markets:

The major US stock market indices finished last week higher, with the Dow +1.7%, the S&P +1.2%, and the Nasdaq +1.1%. Yesterday (04/01/19) the market continued its upward movement with all three indices up about 1.2%. (; 04/02/19)

Financial talkers (radio and TV) and writers (print media) have applauded the fact that in the quarter ending last Friday, US stocks reported the best quarter in a decade … the S&P 500 was up 13%, the Dow 11%, and the NASDAQ up almost 17%. By comparison, the average Q1 gain for the S&P 500 for the past 25 years was 1.7%. (; 03/31/19)

However, the reality is that most of this January through March upswing was simply a recovery (partial) from last fall when the S&P 500 fell 15%, the DOW declined almost 19% and the NASDAQ dropped 23% (10/03/18 to 12/24/18). All three indices are still two or three per cent down from their last-October highs. That said, last week’s performance was a nice way to end the quarter and it may be that the Market is trying to break out of its malaise that I mentioned last week. (; 04/02/19)

Miscellaneous Market Stuff:

  • Estimated (year-over-year) Q1 corporate revenue growth is projected to be +4.8%, which is lower than estimates were several weeks ago.
  • Indications are that Q2 will be positive for domestic equities.
  • Market volatility declined significantly in Q1 (the CBOE Volatility Index dropped 46% in Q1 to a level close to its historical average; (; 04/01/19).

Trivial But Significant:

Most people are familiar with the principle that if you want to be successful in a particular area, study the folks who are successful in that area and emulate them.

Regarding financial success, most financial planning websites have the same advice for saving money – delete the $5 lattes, don’t eat out except on special occasions and decrease spending on entertainment. Or, quit spending money on a host of non-essential activities that almost everyone enjoys. However, when TD Ameritrade surveyed its clients who are “Super Savers” (i.e., those who save or invest 20% or more of their incomes), they found something very different.

It turns out the single biggest difference between the spending of Super Savers and everyone else was – spending on housing. Super Savers spend just 14% of their incomes on housing (principal, interest, taxes and insurance), while everyone else averages about 23%. But the Super Savers haven’t discovered a secret strategy or formula … they simply live in smaller houses, which is a radical idea in the “bigger is better” real estate world.

Hope you’re having a nice week.

Wayne Copelin, CFP®

President, Copelin Financial Advisors, Inc.

514 Brooks Street

Sugar Land, TX 77478

Phone (281) 240-2902

Fax: (281) 240-2856

Securities offered through ProEquities, Inc., a Registered Broker-Dealer and Member FINRA & SIPC Advisory Services offered through Harvest Investment Services, LLC., a Registered Investment Advisor Copelin Financial Advisors, Inc and Harvest Investment Services, LLC are independent of ProEquities, Inc.



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