Markets Up, New Data on the Horizon- February 27, 2017
Once again, domestic markets reached record highs last week. The S&P 500 was up by 0.69% and the NASDAQ increased by 0.12%.1http://finance.yahoo.com/quote/^GSPC/history?period1=1487307600&period2=1487912400&interval=1d&filter=history&frequency=1dhttp://finance.yahoo.com/quote/^IXIC/history?period1=1487307600&period2=1487912400&interval=1d&filter=history&frequency=1d With its 0.96% week-over-week growth, the Dow has posted gains for 11 straight days and is currently experiencing its longest record streak since 1987.2https://www.bloomberg.com/news/articles/2017-02-23/asian-stocks-signal-cautious-start-as-yen-gains-markets-wraphttp://finance.yahoo.com/quote/%5EDJI/history?period1=1487307600&period2=1487912400&interval=1d&filter=history&frequency=1dhttps://www.bloomberg.com/news/articles/2017-02-23/asian-stocks-signal-cautious-start-as-yen-gains-markets-wrap On the other hand, international equities in the MSCI EAFE lost ground, dropping by 0.25% for the week.3https://www.msci.com/end-of-day-data-search
Last week did not offer much new information on economic fundamentals. With the
exception of January increases for new single-family homes and the fastest pace of
existing home sales since 2007, we do not have a tremendous amount of new data to share.4http://www.ftportfolios.com/Commentary/EconomicResearch/2017/2/22/existing-home-sales-increased-3.3percent-in-january
In the absence of this data, focusing on the roiling political conversations becomes much easier. As we have said before, we encourage you to pay attention to how the economy is performing—not what the headlines are blaring. Rather than recount the policy debates and political back-and-forth, we will discuss three important economic developments on our horizon: revised GDP, February CPI, and Fed interest rate deliberations.
February 28: Revised Q4 2016 GDP
On Tuesday, we will receive the second growth estimate of the U.S. economy during the fourth quarter of 2016, which came in at 1.9% in the first estimate.5http://wsj-us.econoday.com/byshoweventfull.asp?fid=477648&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp – top Consensus is that the revised estimate will increase to 2.1%, but we will have to wait until March 30 to see the third and final measurement of Q4 economic growth.6http://wsj-us.econoday.com/byshoweventfull.asp?fid=477648&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp – top
The Bottom Line: GDP is key in measuring the U.S. economy’s strength. Any upward revisions would signal our economy is growing faster than the initial readings indicated.
March 15: February Consumer Price Index (CPI)
In January, the CPI experienced its largest month-over-month jump since 2013.7http://www.ftportfolios.com/Commentary/EconomicResearch/2017/2/15/the-consumer-price-index-increased-0.6percent-in-january The upcoming February report will help to show whether prices are continuing to increase and how the cost of living is changing.
The Bottom Line: The CPI measures changes to the average cost of specific goods and services that consumers purchase and is a key indicator for inflation.8 http://wsj-us.econoday.com/byshoweventfull.asp?fid=477392&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp – top This data
affects the bond and equity markets, labor contracts, Social Security payments, tax brackets, and more.9http://wsj-us.econoday.com/byshoweventfull.asp?fid=477392&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp – top
March 15: Federal Open Market Committee (FOMC) Meeting Announcement
From March 14 – 15, the FOMC will meet and determine whether or not to raise the Federal Reserve’s benchmark interest rates.10http://wsj-us.econoday.com/byweek.asp?day=13&month=3&year=2017&cust=wsj-us&lid=0 After the meeting concludes, Fed Chair Janet Yellen will announce their decision—a move that market participants will watch very closely. Yellen recently commented that “Waiting too long to [raise rates] would be unwise.”11http://www.cnbc.com/2017/02/14/fed-chair-janet-yellen-unwise-to-wait-too-long-to-hike-interest-rates.html However, Wall Street does not expect an increase in March and shows a less than 1 in 5 chance of this move.12http://www.cnbc.com/2017/02/21/the-fed-and-the-market-are-having-a-hard-time-getting-on-the-same-page.html
The Bottom Line: When the Fed changes its benchmark interest rate, the effects reverberate throughout our economy. According to Barron’s, the FOMC interest-rate policy meetings “are the single most influential event for the markets.”13http://wsj-us.econoday.com/byshoweventfull.asp?fid=477648&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp – top If the Fed decides to raise rates, this choice would affect interest rates now and also imply that monetary policy will continue to tighten throughout 2017.14http://www.cnbc.com/2017/02/21/the-fed-and-the-market-are-having-a-hard-time-getting-on-the-same-page.html
These upcoming details are only a few of the noteworthy economic details on the horizon. If you have questions about what other fundamental data we are tracking or believe could affect your financial life, we are always here to talk.
CEO, Managing Director
MGO | Wealth Advisors
Monday: Durable Goods Orders, Pending Home Sales Index
Tuesday: GDP, Consumer Confidence
Wednesday: Motor Vehicle Sales, PMI Manufacturing Index, ISM Mfg Index,
Friday: PMI Services Index, ISM Non-Mfg Index
Notes: All index returns exclude reinvested dividends, and the 5-year and 10-year returns are annualized. Sources: Yahoo! Finance, S&P Dow Jones Indices and Treasury.gov. International performance is represented by the MSCI EAFE Index. Corporate bond performance is represented by the SPUSCIG. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly.
“The ancestor of every action is a thought.”
– Ralph Waldo Emerson
Ginger Sesame Salmon Packets
An easy way to serve this Asian-inspired entree.
- 4 thin onion slices, separated in rings
- 4 medium carrots, shredded or julienned
- 4 fresh salmon filets (4 to 6 ounces each)
- 2 teaspoons fresh ginger, grated
- 2 tablespoons seasoned rice vinegar
- 1 teaspoon sesame oil
- Salt and pepper
- Preheat oven to 450° or prep grill to medium-high heat.
- Cut 4 pieces of non-stick aluminum foil, large enough to wrap each piece of fish.
- Place 1/4 of onions and carrots into the center of each piece of aluminum foil.
- Top each onion and carrot pile with a salmon filet.
- Sprinkle ginger on salmon filets.
- Drizzle sesame oil and rice vinegar on each filet.
- Season with salt and pepper, to taste.
- Bring up ends of one foil square.
- Seal packet by double-folding ends and top, leaving space inside for heat to circulate.
- Repeat foil prep for all packets.
- Garnish with a pinch of fennel.
If cooking in oven
- Place 4 packets on baking sheet.
- Bake for 16 to 20 minutes.
If cooking on grill
- Place packets directly on heated grill and close lid.
- Grill for 14 to 18 minutes.
Recipe adapted from The Food Network15http://www.foodnetwork.com/recipes/ginger-sesame-salmon-packets
Know These Helpful Facts About Capital Gains and Losses
The IRS requires taxpayers to claim gains and losses they have on any capital assets they own when filing their personal taxes. How much you pay in taxes and whether or not you can deduct items depends on your unique financial details. Here are some details to keep in mind as you file your taxes this year.
What are capital assets?
You hold capital assets when you buy both physical and investment properties. Physical property includes items like a home or car. Investment property includes assets such as stocks and bonds.
What are gains and losses?
Whenever you sell a capital asset that you own, you will have either a gain (profit) or loss (deficit). You calculate your gain or loss by determining the difference between the basis (typically what you paid for the capital asset) and what you received after the sale.
Details to Consider
Net Investment Income Tax:
When filing your taxes, your income must include all capital gains. Depending on how much income you made, you may have to pay the 3.8% Net Investment Income Tax on your capital gains.
Taxpayers are able to deduct any financial losses on their investment properties. However, any physical properties you own for personal use do not count toward your deductible losses.
You may be able to carry over your total net capital losses if this amount is more than the amount you’re allowed to deduct.
Tip courtesy of IRS.gov16https://www.irs.gov/uac/capital-gains-and-losses-10-helpful-facts-to-know-2
New to Golf? Avoid These Mistakes
As a new golfer, you have many tricks of the trade to learn as you perfect your game. However, if you want to advance more quickly, start by avoiding these three mistakes:
- Not using properly fitted clubs
New golfers often use clubs that don’t fit their current abilities and playing style. Just because you find a set for sale or purchase the top brand on the market doesn’t mean they’re the right clubs for you. If you keep having problems with your swing, you may be using improperly fitted clubs. As a beginner, you want a good balance of forgiveness in your clubs mixed with control. As you start to improve, you’ll want to make sure you upgrade your clubs to reflect your new skill level.
- Neglecting your club’s grooves
You know those times when you know you nailed your shot with the perfect stroke and backspin—and then it just falls flat without any spin? Many factors can cause this to happen, including the ball, club, or technique. On the other hand, your club’s grooves could be to blame. They need to be neat and clean to support the shot, especially if you’re using lofted clubs. Start a habit of checking and cleaning your grooves after every shot and before every game. If you keep them clean and still see your performance and spin falling, you probably need a shop to re-groove your clubs.
- Overemphasizing distance and power
These days, golfers often focus on distance over finesse and accuracy. And manufacturers design clubs to hit monster distances. As a result, new players often hit the ball too hard, thinking that if they swing hard enough, the ball will travel faster. What really happens, however, is you lose balance, tempo, and rhythm in your swing—and you might miss the ball’s center. You are also more likely to close your eyes, damaging your concentration and accuracy. Instead of focusing on speed, put your efforts into having a consistent swing that hits the ball’s center. Only after mastering your swing should you think about trying to pick up the speed.
Tip courtesy of Golf Digest17http://www.golftipsmag.com/instruction/faults-and-fixes/five-common-golf-beginner-mistakes/
How to Help Chronic Back Pain
Living with chronic back pain can hurt your quality of life. While medications do exist to help lessen the pain, these simple tips can help you treat back pain at home.
- Improve your sleeping position
The position you sleep in each night may be directly affecting your back pain. And the worse the pain is, the more difficult it can be to get a good night’s sleep. To lessen your back pain at night, first make sure you’re sleeping on a mattress that is comfortably firm. Then, try laying on your side and place a pillow between your knees. This support will help you relieve back strain by keeping your spine in a neutral position. If you need to sleep on your back instead, place a pillow under your knees.
- Keep moving
Staying active with back pain may seem counterintuitive, but in reality, rest makes your back pain worse. Regular exercises, such as swimming, doing yoga, and walking, can help lessen your pain by strengthening and stretching back muscles. If you do need to rest, don’t do so for longer than two days and always make sure you get up slowly and carefully.
- Alternate between icing and heating
You can help improve the pain and inflammation from your back pain by icing and heating the problem area multiple times a day, for 20 minutes in each session. For the first few days, focus on icing your back with an ice pack wrapped in a thin towel. Next, switch to heating your back for a few days with a heating pad or warm pack, which will relax your muscles and help send more blood to the problem area. Warm baths can also be great for soothing painful backs.
Tip courtesy of WebMD18http://www.webmd.com/pain-management/recurring-pain-11/slideshow-relieving-back-pain
Buy the Right Filter for Your Local Drinking Water
Removing chemicals from drinking water is important to many people as they move toward greener, healthier living. Even though the Safe Drinking Water Act has protected our water since 1974, this law does not guarantee that all water currently meets health-safety guidelines. Here are some tips for how to check what’s in your water so you can match which filter will best serve your needs.
Know what’s in your drinking water
Read your city’s annual water-quality report
Each year, your local water supplier will publish a consumer confidence report about the quality of your drinking water. You may also be able to find your locale’s report on the U.S. Environmental Protection Agency (EPA) Website.
Explore “What’s In Your Water” online tool
The Environmental Working Group has an online tool available to the public. You can access previous reports on your local drinking water, which includes a breakdown of various toxins and their levels.
Understand different water filters
- Carbon filters: These remove a number of impurities, including lead, PCBs, certain parasites, pesticides and herbicides, some levels of bacteria (such as Cryptosporidium and Giardia), and limited pharmaceuticals.
- Reverse-osmosis systems: These remove chemicals that carbon filters may allow through, such as perchlorate, sulfates, industrial chemicals, heavy metals, and pharmaceuticals.
- Ultraviolet light: These remove bacteria, and experts suggest you pair them with carbon filters.
Tip courtesy of National Geographic 19http://environment.nationalgeographic.com/environment/green-guide/buying-guides/water-filter/shopping-tips
Share the Wealth of Knowledge!
Please share this market update with family, friends or colleagues. If you would like us to add them to our list, simply click on the “Forward email” link below. We love being introduced!
If you would like to opt-out of future emails, please reply to this email with UNSUBSCRIBE in the subject line.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
Diversification does not guarantee profit nor is it guaranteed to protect assets.
International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.
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.
The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indices from Europe, Australia and Southeast Asia.
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.
The SPUSCIG launched on April 09, 2013. All information for an index prior to its Launch Date is back-tested, based on the methodology that was in effect on the Launch Date. Back-tested performance, which is hypothetical and not actual performance, is subject to inherent limitations because it reflects application of an Index methodology and selection of index constituents in hindsight. No theoretical approach can take into account all of the factors in the markets in general and the impact of decisions that might have been made during the actual operation of an index. Actual returns may differ from, and be lower than, back-tested returns.
The S&P/Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate. The index is made up of measures of real estate prices in 20 cities and weighted to produce the index.
The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
By clicking on these links, you will leave our server, as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.
Headquartered in Newport Beach, California, MGO Wealth Advisors, LLC is a very different kind of investment management firm. more >>>
References [ + ]