Monthly Market UpdateSubmitted by Texas Legacy Wealth Management on November 1st, 2019
While October was fairly steady for the stock market, with the S&P 500 closing near all-time highs (YCharts), we had significant developments on a number of fronts and made changes to portfolios. Last month we discussed the worsening economic dashboard as two of our seven indicators are currently flashing red: The Yield Curve and Business Confidence. This deterioration is a reminder that we are moving later in this economic cycle, and potentially signals that the odds of recession over the next 9-12 months may have increased. When we believe risk is too high, or a recession is coming, we have the capability to take further action to try to preserve your assets. As such, we made changes to accounts in order to reduce risk and position our strategies a little more cautiously at this time.
We will continue to monitor the current economic environment and major market moving developments carefully and will be ready to make further changes to accounts as needed.
Here’s the latest update on recent headlines:
- Trade: The US and China appeared to make progress with a template for a “Phase 1” agreement. The two sides still need to nail down the details and sign an agreement, but it appears there may be some momentum on the trade front.
- Brexit: Once again we saw major changes in the Brexit landscape. The Brexit deadline has been extended through the end of January, and a general election will take place in December. The potential leadership change is likely to shape how the Brexit deal is handled in the future.
- Central Banks: The Federal Reserve cut rates for the third time this year in what many investors are calling a “mid-cycle adjustment”. The question for investors is whether the recent cuts will extend the current economic cycle or if there is further economic weakness ahead.
- Economic Data: Economic data this month included better than expected 3rd quarter GDP growth of 1.9%. While surprising to the upside the decelerating growth resulted in the weakest GDP reading thus far this year, with data showing the economy continues to be carried by a strong consumer. (Wall Street Journal)
As we rapidly approach the end of the year, we’d encourage you to reach out to us with any year-end planning items.
Your TLWM Team
*Investment advice offered through TLWM, LLC., a registered investment advisor.
* The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged index. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* Consult your financial professional before making any investment decision.
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