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March Market Commentary

US stocks were flat in March as investors reevaluated whether the new administration will be able to impact taxes, regulations and infrastructure spending to the same degree as projected after the election. Economic reports were again positive for the most part with 235,000 jobs added in February, the unemployment rate falling to 4.7% and wage growth picking up, rising 2.8%, consumer confidence hit its highest level in 16 years, and fourth quarter GDP was revised up to 2.1%, from 1.9%, above expectations. On the downside auto sales were flat, retail sales had their weakest gain since last summer and durable goods orders were subdued. Oil prices eased over the month falling over 6% on robust supply. US stocks edged up 0.07% in March raising the year to date performance to 5.74%.

Foreign stocks surged in March as economic data continues to improve. Germany posted a 2.8% increase in industrial production in February and the eurozone jobless rate hit its lowest level since 2009. The ECB said they will not reduce the bond purchase program they have in place, or cut it short despite recent positive economic news, but Draghi did state that it’s unlikely they will need to continue past the end of this year. The UK officially notified the EU of its intention to leave setting off a likely acrimonious two year negotiation. In a victory for the EU, Geert Wilders, an anti immigration candidate in the Netherlands failed to make inroads in the Dutch election. Brazil’s recession reached two years as GDP contracted 3.6% in 2016. Developed markets outpaced emerging markets for the month, but emerging markets well outpaced developed markets for the quarter. In March, international stocks rose 2.56%, bringing the year to date performance up to 7.92%.

Bonds were flat in March as interest rates ticked up slightly. As expected the Fed elected to raise interest rates a quarter of a percent to a range of 0.75% to 1.0% at its March meeting. The increase was made as the Fed views the US economy as being on more solid footing. They still expect to make two additional quarter percentage point increases this year. The projections for the rest of the year were less aggressive than the market had anticipated. The 10 year Treasury yield ticked up slightly for the month rising to 2.40%, but is down from 2.45% to start the year. For the month shorter term bonds generally outpaced longer terms bonds while it was the opposite for the quarter. Muni bonds were the top performing sector for the quarter and month. The broad bond ticked down 0.05% in March, but is up 0.82% for the year to date.

 

Index Performance MarchQ1Trl 1 Yr
US Stock (Russell 3000)0.07%5.74%18.07%
Foreign Stock (FTSE AW ex US)2.56%7.92%13.85%
Total US Bond Mkt. (BarCap Aggregate)-0.05%0.82%0.44%
Short US Gov. Bonds (BarCap Gov 1-5 Yr)0.05%0.39%-0.13%
Municipal Bonds (BarCap 1-10yr Muni)0.12%1.55%0.21%
Cash (ICE ML 3Month T-Bill)0.02%0.10%0.36%

Financial News for the Week Ending April 26th

All the news you need to stay informed about what’s currently driving the market – courtesy of Raffa Wealth Management, LLC.

US stocks ended the week flat on mixed corporate earnings.  The S&P 500 dropped 0.1% and the Dow fell 0.3%.  Internationally, Europe was up 0.3%, while Japan was down 0.6%.  Gold rebounded over $1,300 an ounce on fears over the Ukraine/Russia situation escalating and the 10 year Treasury yield sank to 2.67% to end the week. Article

ECB business activity expanded at the fastest pace since May of 2011 in April, but prices declined adding to deflation concerns.

New home sales sank 14.5% in March and mortgage demand plummeted in the first quarter hitting a 14 year low as a combination of higher prices and higher interest rates kept buyers and refinancings away.  Article

SunTrust, Boeing, Facebook, Apple and Microsoft all posted 1Q earnings reports that topped expectations.  On the downside GM, Amazon and Ford posted results that missed the mark.

About

Raffa Wealth Management is an independent investment advisor providing nonprofit organizations, high net-worth investors, and qualified retirement plans with a full range of investment consulting services.  We were established to fill the need for transparency, clarity, and vision in the professional management of investment assets.   Visit us at www.raffawealth.com

Financial News for the Week Ending April 13th

All the news you need to stay informed about what’s currently driving the market – courtesy of Raffa Wealth Management, LLC.

US stock markets posted another week of strong performance and its best since the first week of the year.   The S&P 500 gained 2.3% and the Dow rose 2.1% reaching fresh records during the week.  Internationally, Europe rose 1.8% and Japan continued to soar on its easy money policies up 5.1%.  The 10 year treasury yield finished the week slightly higher at 1.721% as weak economic news kept demand high.  Article

Gold has fallen precipitously in recent weeks dropping 4.7% for the week to finish at $1,501 an ounce.  It’s at its lowest level since July 2011 as investors have become less concerned with inflation and willing to move into equities.

Retail sales fell 0.4% in March as consumers appear to be spending more cautiously. Consumer sentiment dropped to its lowest point in 9 months as well.  Article

Alcoa kicked off earnings season with a 59% rise in profits, which beat expectations.

JC Penney ended the disastrous run of CEO Ron Johnson by firing him.  The much heralded former Apple executive tried to overhaul the retailer, but his changes resulted in plunging sales. 

Worldwide shipments of laptops and desktops dropped 14% in the first quarter from the year earlier.  The largest drop since the data has been tracked.

Both Wells Fargo and JP Morgan reported declining revenue in the first quarter as the home refinancing boom has subsided.  Article

About

Raffa Wealth Management is an independent investment advisor providing nonprofit organizations, high net-worth investors, and qualified retirement plans with a full range of investment consulting services.  We were established to fill the need for transparency, clarity, and vision in the professional management of investment assets.   Visit us at www.raffawealth.com