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Stocks Dip on Growth Concerns – March 11, 2019

The Week on Wall Street

As in February, investors spent most of the first full trading week of March hoping for new details in U.S.-China trade negotiations. While they waited, stock benchmarks drifted downward. From Monday’s open to Friday’s close, the S&P 500 lost 2.55%, while the Dow Industrials took a 2.66% fall, and the Nasdaq Composite weakened 3.12%. The MSCI EAFE index tracking developed markets outside the U.S. and Canada fell 1.09%.1https://quotes.wsj.com/index/SPX,2https://quotes.wsj.com/index/DJIA,3https://quotes.wsj.com/index/NASDAQ,4https://quotes.wsj.com/index/XX/990300/historical-prices

Why did stocks lose momentum? In a hint that global economic growth might be slowing, the European Central Bank abruptly reduced its 2019 Gross Domestic Product forecast for the eurozone from 1.7% to 1.1%. A disappointing reading on U.S. hiring also raised questions.5https://www.cnbc.com/2019/03/07/stock-market-us-china-trade-jobless-claims-in-focus.html

Perplexing Jobs Data

According to the Department of Labor, the economy generated only 20,000 net new jobs in February. This was the smallest monthly gain since September 2017. Nevertheless, the unemployment rate fell to 3.8%, while underemployment declined sharply to 7.3%. (These decreases could reflect furloughed federal employees returning to work.) The average wage rose 3.4% in 12 months, the largest year-over-year increase in a decade.

Harsh winter weather may have impeded hiring last month, and February’s payroll growth could be revised in the Department of Labor’s next report.6https://www.usatoday.com/story/money/2019/03/08/jobs-report-just-20-000-added-february-economists-expected-181-000/3098383002/

Earnings Season Recap

The fourth-quarter reporting season is all but over. FactSet notes that the S&P 500 has seen earnings growth of 13.4% in Q4, marking the fifth straight quarter with a double-digit rise.7https://insight.factset.com/earnings-insight-q418-by-the-numbers-infographic

Final Thought

Stocks lost ground last week, breaking a long string of weekly advances. The extended rally partly reflected optimism that the U.S.-China trade dispute would soon be resolved, but a deal may or may not happen. The week offered a reminder that Wall Street sees both ups and downs. Day-to-day market fluctuations should not cause you to alter your long-term approach.

Robert Roman
CEO, Managing Director
MGO | Wealth Advisors

THE WEEK AHEAD:

KEY ECONOMIC DATA

Monday: January retail sales.

Tuesday: The Consumer Price Index, tracking monthly and yearly inflation.

Thursday: January new home sales and February retail sales.

Friday: The University of Michigan’s initial March consumer sentiment index, measuring consumer confidence.

Source: Econoday / MarketWatch Calendar, March 8, 2019

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 release of data may be delayed without notice for a variety of reasons.

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Tuesday: Dick’s Sporting Goods (DKS)

Wednesday: Smart & Final (SFS)

Thursday: Adobe Systems (ADBE), Broadcom (AVGO), Dollar General (DG)

Source: Morningstar.com, March 8, 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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“I’m a greater believer in luck, and I find the harder I work the more I have of it.”

― Thomas Jefferson

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    Reconstructing Your Records After a Natural Disaster

    Fire, hurricanes, and earthquakes – sometimes disaster strikes before we can get prepared. Making an emergency preparedness kit with food, supplies, radio, prescriptions, and important documents is your best bet before a disaster happens. Getting your records together and providing an accurate account of losses after a disaster will help with general tax purposes and will also be required for obtaining federal assistance, grants, loans, or insurance reimbursements. Here are a few tips:

    • Take photos and/or video as soon as possible after the disaster.
    • Contact title, escrow, or banks to get copies of needed documents. Your real estate broker may have these records as well.
    • Research comparable homes in your neighborhood for value.
    • Review insurance policies; they can contain a base value for replacement.
    • If you made improvements to your home, contact the contractor for verification of costs.
    • You can check the county assessor’s office for old records.

    Reconstructing your records will help you to get re-established should your home be affected by a disaster.

    Tip adapted from IRS.gov8https://www.irs.gov/newsroom/reconstructing-records-after-a-natural-disaster-or-casualty-loss-irs-provides-tips-to-help-taxpayers

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    Putt Like the Pros

    Next time you’re at your local course, take a glance at the putting green, and you’ll see an infinite number of different putting styles. Even with the “pros,” you’ll see thousands of different grips, stances, and even, putters. It’s natural to wonder why anyone putts the way they do with the “flat stick.”

    That’s where the basics of great putting come into play.

    Beginning line control: the position of your eyes and your ability to see a straight line when you look at the intended target.

    Control your speed: speed issues plague every golfer, regardless of their experience level, and improving your speed control may lead to massive improvements in your score

    Read the green: the correct read for any given putt can be variable based on a combination of start line and speed.

    Master these putting elements, and your score is sure to drop.

    Tip courtesy of Brandon Stooksbury, PGA | Golf Tips Magazine9https://www.golftipsmag.com/instruction/putting/the-abcs-of-great-putting/

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    You’re a Natural Beauty

      Beauty products can be a source of toxic chemicals in your home you may not have thought about. Minimize the toxins with DIY, natural formulas to replace some of the products you’re using. Here are a few you can make with items you may already have:

      Apple Cider Vinegar (to clarify your hair)

      Use ¼ cup of organic apple cider vinegar with 1 cup of water and follow with conditioner. It will remove any build up you may have from hair products like gel or hairspray.

      Body Scrub

      For a quick body scrub, mix olive oil and kosher salt (in a 2:1 oil-to-salt ratio). It will exfoliate your skin, leaving you soft and glowing.

      Honey Face Mask

      Just honey! Use organic, if you can. Measure about 1 Tbsp. and smooth it over your face, leaving it on for 10 minutes. Honey is naturally antimicrobial and will cleanse and soften your face.

      Deep-Conditioning Hair Treatment

      Massage melted coconut oil into your hair and scalp, leaving the oil on for 1 to 2 hours. When you’re ready, wash out the coconut oil with shampoo and skip the conditioner.

      Tips adapted from Thank Your Body10https://www.thankyourbody.com/10-super-simple-all-natural-beauty-tips/

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      Invisible Water Waste

      Food waste is often connected to water waste. That’s because producing, processing, and transporting our food requires a lot of water. Animals and crops need water to survive, so their water footprint is an important consideration when using the products they yield. Here are a few hypothetical examples to consider:

      • Tossing a quart of milk = taking 6 baths
      • One rotting clementine = flushing the toilet 3 times
      • Wasting half a glass of orange juice = flushing the toilet 12 times
      • Only ate half of that hamburger? Throwing away the other half equals a 60-minute shower. Left a bite of steak behind? That equates to running the dishwasher 22 times.

      Tip adapted from Cape Chameleon11https://capechameleon.co.za/the-water-footprint-of-what-we-eat/

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      The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.

      The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.

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      The S&P U.S. Investment Grade Corporate Bond Index contains U.S.- and foreign-issued investment-grade corporate bonds denominated in U.S. dollars.

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