We Keep Seeing Better News – Really, I’m Not Kidding.
Over the past two weeks, there have been about 14 stronger reports out of the economy – without listing all of them, some of them are better vehicle sales, manufacturing and non-manufacturing purchasing manager index (PMI) reports, employment and retail sales. On top of that, there were some good earnings reports too. In fact, 26 of the 38 companies that have reported earnings so far have beaten their expected earnings. That’s about 68%. In case you were wondering – that’s better news than we were seeing in the late summer. Seriously!
For the week, the Dow Jones Industrial Average (DJIA) gained 4.88% to finish at 11,644, the Standard & Poor’s 500 Index (S&P 500) gained 5.98% to finish at 1,225 and the Nasdaq Composite Index gained a whopping (relative to even the big gains of the DJIA and the S&P 500) 7.60% to finish at 2,668. The Russell 2000 Index, which tracks the performance of small capitalization stocks, also had a whopping gain of 8.57% to finish at 712.
There is still the possibility that some problems get worse – the Eurozone gets worse, the global slowdown get worse and of course there may be continued political gridlock out of Washington DC throughout the next year – but we want to make sure that there is equal attention paid to the good news.
The reality of it is, if you had a long-term plan in place and no changes in your life required a need to raise cash, you did not panic and sell. If that’s the case, you are probably doing pretty well relative to those who “simply couldn’t take it anymore”, sold a few weeks back and are holding cash. Because now they have to decide when to get back in – and that’s harder than it sounds.
Call us for help or if you have any questions.
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Securities and Financial Planning offered through LPL Financial, a Registered Investment Advisor. Member FINRA/SIPC
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly. Stock investing involves risk including loss of principal. The Dow Jones Industrial Average is comprised of 30 stocks that are major factors in their industries, and widely held by individuals and institutional investors. The Standard & Poor’s 500 Stock Index (S&P 500) is an unmanaged capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The NASDAQ Composite Index measures all domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index. The Russell 2000 Small Stock Index is an unmanaged index generally representative of the 2000 smallest companies in the Russell 3000 Index. The Russell 2000 is an unmanaged index generally comprised of companies with lower price-to-book ratios and lower forecasted growth values.
David B. Armstrong, CFA
President & Co-Founder
Dave got into the industry when he discovered his passion for finance in his mid-20’s. He’s a combat veteran and served as an officer in the United States Marines Corps on both active duty and in the reserves, retiring at the rank of Lieutenant Colonel. While serving on active duty, Dave was unable to spend money on deployments, so he became a self-taught investor. Along with a few bucks cash as a bouncer, his investing performance grew to be good....
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