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Dow, Nasdaq, S&P 500 Advance – September 9, 2019

The Week on Wall Street

Stocks rose last week, with help from two developments: the announcement of further U.S.-China trade talks as well as August hiring and manufacturing numbers that seemed to bolster the argument for a rate cut by the Federal Reserve.

The broad U.S. equity market, as represented by the S&P 500, added 1.79% during a 4-day trading week. The Dow Jones Industrial Average improved 1.49%; the Nasdaq Composite, 1.76%. Foreign shares tracked by the MSCI EAFE index gained 1.69%.1https://www.wsj.com/market-data,2https://www.wsj.com/market-data,3https://quotes.wsj.com/index/XX/990300/historical-prices

Trade Talks Poised to Restart

Trade representatives from the U.S. and China are planning to head back to the negotiating table early next month. This news came Thursday from China’s ministry of commerce, which confirmed a verbal agreement among Secretary of the Treasury Steven Mnuchin, U.S. Trade Representative Robert Lighthizer, and Chinese Vice Premier Liu He.

Formal trade discussions between the U.S. and China last happened in July. China has said that it wants punitive U.S. tariffs on its products removed in the event of a deal.4https://www.cbsnews.com/news/u-s-china-trade-talks-scheduled-for-october-beijing-says-2019-09-05/

Weaker Hiring & Manufacturing Data

Payrolls expanded with just 130,000 net new jobs in August, according to the Department of Labor; 25,000 were temp jobs linked to the federal government’s 2020 Census. The main jobless rate stayed at 3.7%. The U-6 rate, which measures both unemployment and underemployment, rose 0.2% to 7.2%.

A key gauge of U.S. factory activity, the Institute for Supply Management’s manufacturing purchasing manager index, fell to 49.1 in August. A number below 50 indicates factory sector contraction. Some investors took these hiring and manufacturing reports as hints of a slowing economy, one which the Federal Reserve could potentially try to stimulate with an interest rate cut.5https://www.bloomberg.com/news/articles/2019-09-06/u-s-payrolls-rise-130-000-boosted-by-25-000-for-census-count,6https://tradingeconomics.com/united-states/business-confidence

What’s Ahead

August inflation data arrives this week, and if looks especially mild, it may amount to another suggestion that the Fed should ease. The European Central Bank concludes a meeting on Thursday, and Fed officials will certainly pay attention to its latest policy statement.7https://www.cnbc.com/2019/09/06/stocks-look-to-reclaim-their-all-time-highs-in-the-week-ahead.html

Robert Roman
CEO, Managing Director
MGO | Wealth Advisors

THE WEEK AHEAD:

KEY ECONOMIC DATA

Thursday: A new Consumer Price Index, tracking both monthly and yearly inflation.

Friday: The August retail sales report from the Census Bureau.

Source: Econoday / MarketWatch Calendar, September 6, 2019

The Econoday and MarketWatch economic calendars list upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Thursday: Broadcom (AVGO), Kroger (KR)

Source: Zacks, September 6, 2019

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

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“Education is the key to unlocking the world, a passport to freedom.”

– Oprah Winfrey

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Tax Incentives Can Help You Further Your Education

All this back-to-school season excitement might make you want to consider furthering your own education, and the IRS might be able to help. Tax credits, deductions, and savings plans can help taxpayers with their expenses for higher education.

  • Tax credits help with the cost of higher education by reducing the amount of income tax you may have to pay. The two tax credits available are the American Opportunity Tax Credit and the Lifetime Learning Credit.
  • Some education savings plans allow your earnings to grow, tax free, until the money is taken out; some allow the deduction to be tax free; some do both.
  • You may be able to deduct higher-education costs, such as tuition, student loan interest, and qualified education expenses, from your tax return.

If you’ve always dreamt about going back to school, whether to further your career or just learn something new, knowing your potential tax benefits may be able to save you money.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS.gov8https://www.irs.gov/newsroom/tax-benefits-for-education-information-center

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The Best Golf Tip? Always Keep Learning

Even if you’ve been playing the sport for years, there’s always something you can learn when looking to get better at golf. One of the best ways to improve your game is to attend a golf school or academy. These training programs are led by highly trained instructors and players, and most feature intimate, teacher-to-student ratios and other great amenities. This face-to-face time is priceless if you want to improve your game.

There are top-tier schools throughout the country, even if you don’t live near one of the most-famous courses. They also range in intensity, from lessons for beginners to intensive golf workshops for seasoned players who want to fine-tune their skills. Golf Digest shares a comprehensive list of some of the best golf schools and academies in the U.S. While you might not be hitting 350-yard drives like the pros, you can definitely learn a thing or two from these highly skilled coaches (and make some golf-minded friends along the way).

Tip adapted from Golf Advisor9https://www.golfdigest.com/story/best-golf-schools-and-academies

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The Benefits of Brain Training

    We know how important it is to exercise our bodies, but exercising our brains is just as important. When we continue to learn, our brains are better for it. Here are just a few benefits of “brain training,” or exercising your brain:

    • Improved executive functions
    • Improved working memory
    • Improved processing speed
    • Preserved cognitive health
    • Fewer problems in daily function
    • Better control over our mental processing abilities

    There are lots of fun ways to exercise your brain. One common way is to continue to learn new things. Attend a pottery, painting, or foreign language class in your neighborhood, or check for any discounts on community college courses. Another great way to exercise your brain is to socialize with others, spend time in nature, and practice mind puzzles, such as crosswords, Sudoku, or a game in a brain training app.

    Tip adapted from American Psychological Association10https://www.apa.org/monitor/2014/10/mind-games

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    Green Tips for the Office and the Classroom

    If you’re sending your kids or grandkids off to another year of school or want to implement more green tips in your own office, here are some places to start:

    • Inventory what you have before buying new supplies. Not only does this tip save money, but it focuses on reusing when we can.
    • Choose nontoxic office supplies. Many school and office supplies contain PVC (a dangerous plastic) and other harmful materials. Look for PVC-free binders, recycled pencils and markers, refillable pens, and recycled notebooks and printer paper.
    • Try to implement the “100-mile” diet for you and your kids, meaning that your food doesn’t come from more than 100 miles away. This is a great step in thinking local first and organic for other, nonlocal options.
    • Try to cut down on printed material. Some offices have even gone completely paperless!
    • Buy fair-trade, organic coffee, tea, and drinks for the kids.

    Tip adapted from Small Footprint Family11https://www.smallfootprintfamily.com/10-green-back-to-school-tips

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