The Markets in February
Last month, we witnessed a market with large fluctuations as volatility returned on the heels of interest rate increases from the Federal Reserve and concerns about inflation rising. By the end of last week on March 2nd, the S&P 500 closed at 2691.25. Year to date for 2018, the S&P is still positive 0.66% as of market close on Friday. (1)
In spite of interest rate increases and inflation trepidations, the U.S. economy remains fundamentally strong. In addition, projected increased corporate earnings on the tailwinds of the passage of the tax reform bill have most analysts still anticipating a positive year for the U.S. markets.
Uncertainties do remain present, including geopolitical tensions, a White House investigation, and questions regarding the newly appointed Federal Reserve Chair, Jerome Powell who some on Wall Street speculate may raise interest rates more than what was initially forecasted.
After historically calm markets in 2017, market volatility suddenly awoke in the beginning of last month. Forward-looking into March, it is likely that the markets will be in flux - retesting of the recent highs and/or lows is likely and also characteristic for these types of market conditions. Regardless of which direction the market takes us this month, it is important to remember to view each news headline with a grain of salt as long-term investing success is not predicated upon short-term fluctuations.
1 - http://markets.wsj.com/us [03/04/18]
This post has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Bob Lawson is not engaged in rendering legal or accounting services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.